How the Best Deals Are Won Before the Term Sheet
Why Biopharma Licensing, Partnership, and M&A Share One Path to Leverage

Locust Walk’s latest white paper makes the case that licensing, partnerships, and M&A aren’t separate playbooks. They’re one continuum, and the leverage that shapes a deal’s final terms is built (or lost) long before a term sheet appears. Drawing on an analysis of 32 public acquisitions of clinical-stage biotechs announced between January 2024 and March 2026, the paper finds that more than 90% of those deals began as a licensing discussion or existing partnership, not a formal sale process, with a median of just five months between the first BD conversation and an initial M&A offer.

The paper lays out three principles that apply across deal types: know your true competitive position, run every conversation as if it could become more, and maximize your leverage before the term sheet. It also digs into why timing an advisor’s engagement matters. Deals where an advisor was brought in before any offer existed saw roughly double the improvement in final terms compared to those where advisors joined later.

For any team currently in a BD conversation, fielding early interest, or weighing when to bring in outside help, this paper is a practical guide to protecting and building leverage at every stage.

We welcome the opportunity to discuss further.