US Government Considers Banning Dealings with WuXi AppTec, Affiliates

Image Credit: Adobe Stock Images/JimGlab.com

The US Senate’s homeland security committee has decided to proceed with the approval process for a bill that is intended to serve as a national security measure involving WuXi AppTec, a provider of R&D- and manufacturing-enabling services in the pharma, biotech and medical device industries, and BGI, a genomics company, according to Reuters.¹

The committee’s decision was nearly unanimous, voting 11-1 in favor of the bill.

Although this proposed bill still has many hurdles to overcome—as it must also pass in the rest of the Senate, the House of Representatives, and ultimately be signed by President Biden—the legislation was created to protect US citizens' personal health information. It would ban any federal agencies from doing business with BGI, Complete Genomics, MGI, WuXi AppTec, along with their affiliates, all of which are based in China. The bill is alleging that WuXi has connections to the Chinese military.

News of the proposed bill have since caused WuXi AppTec stock to dip as much as 24%, while Wuxi Biologics Cayman Inc., its sister company, fell 23%. Sixty-six percent of the biotech company’s revenue reportedly comes from the United States, with US-based pharma companies, such as Eli Lilly, often produce mediation in bulk for Medicare and Medicaid.²

WuXi also has multiple sites in the United States, including in California, Delaware, Georgia, Minnesota, New Jersey, Pennsylvania, and Texas.

In an email statement to Reuters, a WuXi AppTec spokesperson claimed that the company does not collect any form of genetic data, and that the bill "relies on misleading allegations and inaccurate assertions to propose preemptive and unjustified prohibitions against our company without due process."

Back in January, an additional bill was also introduced in the House that had accused BGI of being a danger to US national security because of its efforts in collecting genetic data, while referencing both Complete Genomics and MGI as affiliates and subsidiaries.³

References

1. Freifield K, Erman M. US Senate bill targeting China's BGI, WuXi AppTec moves forward. Reuters. News release. March 7, 2024. Accessed March 8, 2024. https://www.reuters.com/technology/us-senate-committee-takes-up-bill-targeting-chinas-bgi-wuxi-apptec-2024-03-06/

2. Cha S. WuXi AppTec Drops as US Senate Panel Advances Bill Banning Deals. BNN Bloomberg. News release. March 6, 2024. Accessed March 8, 2024. https://www.bnnbloomberg.ca/wuxi-apptec-drops-as-us-senate-panel-advances-bill-banning-deals-1.2043658

3. Freifield K. US House bill would curb genetic info sharing with China's WuXi Apptec, BGI. Reuters. News release. January 26, 2024. Accessed March 8, 2024. https://www.reuters.com/world/us/us-house-bill-would-curb-genetic-info-sharing-with-chinas-wuxi-apptec-bgi-2024-01-26/