A bill in the U.S. Congress, causing a sell-off in Chinese biotech firm WuXi AppTec shares, has encountered a delay in the Senate this week. The legislation, sponsored by Democratic Senator Gary Peters, seeks to prohibit federal agencies from engaging with companies like BGI Group, MGI, Complete Genomics, and their subsidiaries due to national security concerns.
Despite expectations, the bill did not progress out of committee and will be revisited in the future, according to Senate aides.
The proposed legislation, which accuses these biotech companies of aiding Beijing’s military, faces similar delays in the House. Republican Congressman Mike Gallagher, leading the House select committee on China, introduced a companion bill targeting these companies.
The move comes amid growing fears that Chinese biotech firms pose a threat to the security of sensitive American data and personal health information, potentially accessible by the Chinese Communist Party. WuXi AppTec and WuXi Biologics experienced a significant decline in shares as investors reacted to the uncertainty surrounding the draft legislation.
WuXi AppTec, emphasizing its non-involvement with China’s military and dismissing national security risks, closely monitors the bill’s development. Meanwhile, BGI Group, placed on a U.S. Department of Commerce export control list, defends its commitment to protecting personal data, asserting that the legislation could drive it out of the U.S. market.
