US bill to restrict WuXi AppTec, Chinese biotechs revised to give more time to cut ties
By Karen Freifeld
(Reuters) -A new version of a congressional bill that would restrict U.S. business with certain Chinese biotechnology companies including WuXi AppTec and BGI would give U.S. companies until 2032 to end work with the firms, extending the amount of time to find new partners.
The latest Biosecure Act also adds WuXi Biologics to a list of biotech companies of concern, according to a copy seen by Reuters. The other companies on the list are BGI, MGI, Complete Genomics and WuXi AppTec.
The companies are largely contractors that do research and manufacturing work for pharmaceutical and biotech firms around the world.
The revised bill was introduced on Friday. A U.S. House of Representatives committee is expected to decide next week whether to move it forward, according to a House Committee on Oversight and Accountability spokesperson.
The committee markup, expected Wednesday, is a procedural step where they discuss and vote on the text of the bill. A similar Senate bill was approved by a committee there in March.
News of the proposed legislation has driven WuXi AppTec and WuXi Biologics shares down this year.
The bills are designed to keep Americans' personal health and genetic information from foreign adversaries and aim to push U.S. pharmaceutical and biotech companies to lessen their reliance on China for everything from drug ingredient manufacturing to early research.
"China has so much control of the market. We've got to start this shift," Rep. Brad Wenstrup said in an interview. But, he added, "we can't cut ourselves off and we don't now want China to cut us off, so we have to do this in a systematic way."
Wenstrup introduced the revised House bill with Rep. Raja Krishamoorthi.
Complete Genomics said it "is encouraged that policymakers understand the detrimental impacts to the U.S. biotech supply chain – and how the legislation would jeopardize the drug supply for millions of American patients." The company said it does not have access to personal DNA data and should be taken out of the bill.
Spokespeople for WuXi Biologics and WuXi AppTec said they had not seen the revised bill and could not comment on it. WuXi AppTec said the original bill relies on "misleading allegations and inaccurate assertions." MGI did not immediately respond to a request for comment.
The latest bill "highlights a key vulnerability in our global supply chain and importantly provides a reasonable timeframe for companies to decouple their reliance on China-based biomanufacturing," John Crowley, president of BIO, an industry association, said in a statement.
The association sent the results of a member survey to Congress on Wednesday. Of the 124 biopharmaceutical companies and biotechnology companies that responded, 79 percent had at least one contract or product agreement with a China-based or owned manufacturer.
The "vast majority" of business described in the survey is assumed to be with WuXi Biologics and WuXi AppTec, Crowley said in an interview.
Companies estimated it would take up to eight years to switch manufacturing partners, the survey found.
BGI Group said, as it has in the past, that it supports protecting Americans' personal data and did not have access to the data. It said the bill would drive BGI out of the U.S. and limit competition.
(Reporting by Karen Freifeld; Editing by Chizu Nomiyama, Michael Erman and Diane Craft)
