The ancient Chinese military strategist Sun Tzu once wrote that when confronting an adversary, it’s important to leave them an escape route to avoid an intractable fight. Washington and Beijing seem to have taken this advice to heart in the biotech industry at a time when both sides are being pressured to cut ties completely.

The US Treasury Department unveiled draft rules last week limiting investment in countries including China and Russia. Washington is proposing to subject Chinese pharmaceutical companies to the same national security restrictions already imposed on industries such as semiconductors and artificial intelligence.

However, a key exception was carved out. The new proposals don’t address pure licensing agreements, a US official told me. That means American companies can continue striking deals to bring Chinese-developed medicines to patients around the world as long as they avoid joint ventures or other forms of direct investments. While this means transactions like Pfizer Inc.’s $100 million equity investment in 3SBio Inc. may no longer be possible, it preserves the most common kind of partnership between global pharma giants and Chinese drug developers. It’s the best result that can be expected just weeks before Presidents Xi Jinping and Donald Trump are due to meet again.

Licensing agreements have been a fixture of Big Pharma’s business model for decades. They allow smaller biotechnology companies to commercialize their discoveries with the help of larger drugmakers without surrendering ownership. An early example was when Genentech Inc., now a unit of Roche Holding AG and an industry pioneer, licensed its groundbreaking insulin technology to Eli Lilly & Co. nearly 50 years ago.

China has disrupted this longstanding model by creating new drugs faster and at a fraction of the cost of its multinational rivals. Facing patent expirations on some of their most profitable drugs, pharma giants have been snapping up treatments to replenish their pipelines, particularly in cancer and obesity, two areas where Chinese research has made rapid advances. Over the past five years, such deals have risen more than 10-fold.

The trend has alarmed both Republicans and Democrats in Washington, who fear that US pharmaceutical companies are becoming too dependent on Chinese innovation. So it’s no surprise that the US Treasury added biotech to the list of industries covered by a national security-related investment law passed in December.

Beijing hit back at the proposal over the weekend, calling it discriminatory. But this is political posturing. Just as Washington frets about a decline in America’s research prowess, there is an analogous debate in China over whether its drugmakers are licensing intellectual property too cheaply. The licensor usually gets only a 10% to 15% cut of revenues outside its home market, even though it has done the early development work.

Influential researchers have started to speak out against the practice of or “selling green seedlings,” which refers to allowing promising drug discoveries to be snapped up by Big Pharma before they’ve had a chance to mature. Li Xiaokun, a national legislator and scientist whose drug patents have achieved 10 billion yuan ($1.5 billion) in sales, said in March that this risks surrendering not just future profits, but also leadership of the global pharmaceutical industry.

Days before the Treasury announcement last week, China’s Commerce Ministry proposed to restrict the overseas sale of five biomedical technologies including cell and gene therapy. But like the Trump administration, Beijing opted to exempt such deals as well as partnerships and the outsourcing of research services.

Because the underfunded domestic health insurance system struggles to afford these innovations, many Chinese drugmakers aren’t able to turn fledgling discoveries into profitable medicines. That means there’s enormous financial incentive to keep licensing them to overseas pharmaceutical companies. The situation isn’t likely to change without an overhaul of the public healthcare system or major expansion of private insurance.

In the meantime, allowing licensing agreements while taking steps to reduce more direct equity-based collaboration is an acceptable compromise. It allows both sides to satisfy critics while preserving a crucial pipeline of new drugs.

Neither side has to betray its core interests to recognize that some forms of cooperation are worth preserving. Sun Tzu understood that even rivals need a way out. In the race to develop lifesaving medicines, keeping that path open is no small victory.