A bipartisan bill introduced on January 26, 2024, by members of the US House Select Committee on strategic competition between the US and China has caused a significant decline in the share prices of various China-based biotech and contract development organizations (CDOs) last week. The companies have begun to respond to the proposed legislation over the weekend.
The bill suggests introducing legislation that would restrict federally funded medical providers from using foreign “biotech companies of concern.” It cites several companies with alleged connections to China’s military, such as stating that “Beijing Genomics Institute (BGI) collects genetic data of Americans and uses it for research with the Chinese military.” BGI subsidiaries MGI and Complete Genomics, as well as the Contract Research and Development and Manufacturing Organization (CRDMO) WuXi Apptec (SHA: 603259), are also mentioned.
On Sunday, China’s MGI Tech responded by stating that as an upstream equipment provider of gene sequencing technology, its business does not involve actual data collection. MGI Tech filed with the Shanghai stock exchange, asserting that “The data generated by customers based on our sequencing platform are collected, stored, processed, and controlled by the customers themselves.” Shanghai-listed GemPharmatech also noted it is not involved in any analysis of human genome sequences and denied that any of its technologies should be included in the proposed bill’s scope. WuXi AppTec CEO Chen Zhisheng was quoted by Jiemian.com as stating: “This is just a proposal from an individual congressman, and I personally believe that it is extremely unlikely to become a law because our business model empowers American companies to benefit American patients.”- Flcube.com
