Shares of Chinese Contract Development and Manufacturing Organizations (CDMOs) WuXi AppTec (SHA: 603259) and WuXi Bio (HKG: 2269) saw a significant surge as the US House Rules Committee decided against incorporating the proposed US Biosecure Act into the critical defense spending bill. The market had been anxiously awaiting the decision, as the Act’s inclusion in the US National Defense Authorization Act (NDAA) would have had significant implications for companies with ties to China.
The Biosecure Act, which exists in two versions being considered by both chambers of Congress, aims to mandate that companies receiving US federal funding sever ties with a curated list of Chinese entities, including genomics giants BGI, MGI, Complete Genomics, WuXi AppTec, and WuXi Bio. The bill’s amended text offered an extension of up to eight years for affected companies to adjust their operations based on current contractual obligations.
Sources indicate that the Act was deemed not relevant to the NDAA’s scope, leading to its exclusion and dampening expectations of its swift legislative progress. This development suggests that the Act is unlikely to be rushed through this year. In response to the news, WuXi AppTec reached out to FierceBiotech.com, stating, “There are several steps left in the legislative process, and we are committed to informing policymakers and federal agencies about our company’s contributions and the essential services we provide to our customers globally.”- Flcube.com
