Trade Truce Fuels Biotech's Next Bull Run: ProKidney Corp Poised to Lead the Charge

The U.S.-China trade truce announced in May 2025 has injected a critical dose of stability into global markets, easing tariff pressures and unlocking capital flows that have long been constrained by geopolitical tension. For investors seeking high-growth opportunities in volatile sectors, this de-escalation presents a unique moment to pivot toward undervalued biotech stocks like ProKidney Corp (PROK). With its Phase 2 clinical trial data nearing release, a $328.5 million cash runway, and FDA pathway clarity, ProKidney stands at the intersection of regulatory progress and macroeconomic relief—a combination primed to catalyze a turnaround in its valuation.

The Trade Truce: A Lifeline for Biotech’s Capital Needs

The temporary truce has already triggered a 2% surge in equity markets, with the Nasdaq and S&P 500 benefiting from reduced uncertainty. For biotech firms, which rely on sustained capital infusion to fund lengthy clinical trials, this stability is a game-changer. ProKidney, for instance, faces a $38 million net loss in Q1 2025—a figure often cited by skeptics—but its $328.5 million cash balance (as of March 2025) buys it 26 months of runway to execute its Phase 3 trials and secure FDA approval. With trade tensions cooling, investors can now afford to take a longer view, rewarding companies like ProKidney that prioritize scientific rigor over short-term profitability.

ProKidney’s Phase 2 Milestone: The Catalyst for a Turnaround

The company’s Phase 2 REGEN-007 trial is set to deliver full data in Q2 2025, a milestone that could redefine its valuation. The trial’s Group 1 cohort, which mirrors the dosing regimen of its Phase 3 trial (REGEN-006), has already shown promise: interim data from June 2024 indicated stabilization of kidney function in 13 patients with advanced chronic kidney disease (CKD) and type 2 diabetes. The full dataset, with an 18-month follow-up, will clarify whether these results hold over the long term—a critical step toward regulatory approval.

FDA Clarity: The Path to Accelerated Approval

ProKidney’s strategic alignment with the FDA’s accelerated approval pathway is a linchpin of its growth thesis. In late 2024, the FDA confirmed that a surrogate endpoint—the rate of kidney function decline (eGFR slope)—could suffice for accelerated approval. This eliminates the need to wait years for endpoints like dialysis initiation, cutting the timeline to market access by 18–24 months. A mid-2025 Type B meeting with the FDA will further refine this pathway, potentially unlocking a Biologics License Application (BLA) submission as early as 2026.

Why Now? The Contrarian Play in a Post-Truce Market

While the trade truce is no panacea—it excludes tariffs on autos and leaves geopolitical tensions simmering—it has created a risk-on environment for sectors like biotech. ProKidney’s $328.5 million cash pile insulates it from near-term liquidity pressures, while its Phase 3 trial (targeting late-stage CKD patients) addresses a $20 billion unmet need in diabetes-related kidney disease. At current valuations, the stock trades at just 5.2x its projected 2027 revenue run rate, offering a deep discount to peers like Amgen (AMGN) or Regeneron (REGN).

Risks? Yes—but the Reward Outweighs Them

Bearish arguments focus on ProKidney’s net losses and the FDA’s potential skepticism of surrogate endpoints. Yet these risks are already priced into the stock. The company’s $1.22 billion accumulated deficit is daunting, but its focus on a single lead candidate (rilparencel) minimizes R&D sprawl, while the FDA’s willingness to use eGFR slope as a surrogate endpoint reflects a broader push to accelerate therapies for fatal diseases.

Final Call: Buy the Dip, Bet on the Truce

The U.S.-China trade truce has removed a key headwind for global equities, and ProKidney’s Q2 Phase 2 data and FDA milestones are the spark needed to ignite its valuation. With a cash runway into 2027 and a clear path to accelerated approval, this is a textbook contrarian play in a sector poised for resurgence. Investors who act now could capture a multi-bagger return as the company transitions from clinical candidate to commercial reality—a journey that begins this summer.

Act before the data drops.