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Standard procedure has been: if you want their investment or their business, you have to surrender your data/IP upon request. And they probably came to these B

Standard procedure has been: if you want their investment or their business, you have to surrender your data/IP upon request. And they probably came to these Biotech companies with a juicy offering of capital. So expect some Biotech breakthroughs in the near future, but not necessarily coming from the West.

api 7y ago
Coming from the west, but not released here.
opportune 7y ago
Pretty sure that's only true if you actually set up operations in China. Not that they might not try to get the IP anyway, but it's definitely not a given. It makes complete sense for a Chinese investor to want to invest in biotech in the US and not China, btw. The US is a world leader in biotech and the American market is... very lucrative in the biotech area as well.
- mdorazio 7y ago
  Nope, it goes for companies setup stateside as well. For example, Faraday Future, a now-failed electric car startup was headquartered in California, but had very strong IP transfer methods in place to get technology developed here back to the China "sister company" also run by the Chinese investors. The same setup is used at a couple of other China-funded startups I've run into in the last couple years as well. Basically, if you take Chinese investment money it's highly likely to come with some very strong strings attached.
  - RidingPegasus 7y ago
    I can never understand how people are complaining about this stuff. You willingly and knowingly sign a contract with the terms stated right there. Whose fault is that? The Chinese? If you signed a contract handing over your large profitable company in exchange for some magic beans who exactly is the bad person here? Don't sign the contract if you don't agree to the conditions. The real people to blame for IP transfer don't seem to cop a single mention by most.
    - jorblumesea 7y ago
      Given the Western way of doing business, it does come as a shock when China spins up a complete clone of your business with government money, including IP and R&D. It's malicious intent. They have no motivation to see the business succeed. It's not like it's spelled out in the contract: "we will use free loans from the Chinese govt to take your tech, undercut your markets and put you out of business. We have no intentions of letting your business thrive and survive." We're getting smarter about it but this is way of doing business is very foreign to the West. The West sees investors as capital assets and not active market players. When Peter Thiel invests in a company he is not looking to spin up his own competing clone. He wants the business to succeed. Not so in China, who has a vested interest in running US businesses into the ground.
      - RidingPegasus 7y ago
        Should other countries cede sovereignty and do exactly what others dictate to them? The West needs be smarter about how to compete and deal with the global landscape rather than crying about it incessantly and childishly trying to divert blame. Nothing illegal happened in the examples above, Western CEO's willingly handed over their property knowing full well what happens. And they did it to profit. India flagrantly walks all over IP too. They have a massive export business stealing new pharmaceuticals and selling generics to the world. This is the reality of the world. Either get smarter at how to manage this stuff or give up. The US is hardly in a position to suddenly want an international arbiter deciding who is playing fair or not given the history of torn up treaties and general aversion to international governance. It's not a game of baseball, countries are free to make their own rules and decide whether they respect yours or not.
        SkyMarshal 7y ago
        As a Westerner I fully agree with this. US seems to have this conceit that China, India and other emerging economies will play by the post-WW2 global trade rules we set up, if we just continue to nudge and pressure them in that direction. But it's been obvious for a while now their intent is to play by their own rules. US whinging about something so blatantly obvious, unsurprising and foreseeable is pretty lame.
majia 7y ago
Please don’t assume US companies are stupid. They know what they are selling and whether they are paid enough. In most cases it’s just about giving away some about-to-be-obsolete tech for some big money.

api 7y ago

Coming from the west, but not released here.

opportune 7y ago

Pretty sure that's only true if you actually set up operations in China. Not that they might not try to get the IP anyway, but it's definitely not a given. It makes complete sense for a Chinese investor to want to invest in biotech in the US and not China, btw. The US is a world leader in biotech and the American market is... very lucrative in the biotech area as well.

mdorazio 7y ago
Nope, it goes for companies setup stateside as well. For example, Faraday Future, a now-failed electric car startup was headquartered in California, but had very strong IP transfer methods in place to get technology developed here back to the China "sister company" also run by the Chinese investors. The same setup is used at a couple of other China-funded startups I've run into in the last couple years as well. Basically, if you take Chinese investment money it's highly likely to come with some very strong strings attached.
- RidingPegasus 7y ago
  I can never understand how people are complaining about this stuff. You willingly and knowingly sign a contract with the terms stated right there. Whose fault is that? The Chinese? If you signed a contract handing over your large profitable company in exchange for some magic beans who exactly is the bad person here? Don't sign the contract if you don't agree to the conditions. The real people to blame for IP transfer don't seem to cop a single mention by most.
  - jorblumesea 7y ago
    Given the Western way of doing business, it does come as a shock when China spins up a complete clone of your business with government money, including IP and R&D. It's malicious intent. They have no motivation to see the business succeed. It's not like it's spelled out in the contract: "we will use free loans from the Chinese govt to take your tech, undercut your markets and put you out of business. We have no intentions of letting your business thrive and survive." We're getting smarter about it but this is way of doing business is very foreign to the West. The West sees investors as capital assets and not active market players. When Peter Thiel invests in a company he is not looking to spin up his own competing clone. He wants the business to succeed. Not so in China, who has a vested interest in running US businesses into the ground.
    - RidingPegasus 7y ago
      Should other countries cede sovereignty and do exactly what others dictate to them? The West needs be smarter about how to compete and deal with the global landscape rather than crying about it incessantly and childishly trying to divert blame. Nothing illegal happened in the examples above, Western CEO's willingly handed over their property knowing full well what happens. And they did it to profit. India flagrantly walks all over IP too. They have a massive export business stealing new pharmaceuticals and selling generics to the world. This is the reality of the world. Either get smarter at how to manage this stuff or give up. The US is hardly in a position to suddenly want an international arbiter deciding who is playing fair or not given the history of torn up treaties and general aversion to international governance. It's not a game of baseball, countries are free to make their own rules and decide whether they respect yours or not.
      - SkyMarshal 7y ago
        As a Westerner I fully agree with this. US seems to have this conceit that China, India and other emerging economies will play by the post-WW2 global trade rules we set up, if we just continue to nudge and pressure them in that direction. But it's been obvious for a while now their intent is to play by their own rules. US whinging about something so blatantly obvious, unsurprising and foreseeable is pretty lame.

majia 7y ago

Please don’t assume US companies are stupid. They know what they are selling and whether they are paid enough. In most cases it’s just about giving away some about-to-be-obsolete tech for some big money.