Askume, Sept 9 – The US House of Representatives on Monday passed a bill aimed at restricting ties with China’s Wuxi AppTec (603259.SS) on national security grounds.
It was the first vote on the Biosecurity Act, which would ban federal contracts with targeted companies and companies that do business with them.
Supporters argue that the measure is necessary to protect Americans’ personal health and genetic information, as well as the US pharmaceutical supply chain.
The bill passed 306 to 81, easily exceeding the required two-thirds majority. The bill will have to pass the US Senate before going to President Joe Biden to become law.
During Monday’s House debate, Representatives John Murnar and Raja Krishnamoorthi, who serve as chairman and ranking member, respectively, of the House Select Committee on China, were among those supporting the bill.
Representative Jim McGovern, a critic of human rights abuses in China, opposed the bill, saying he could not get a clear answer on how the companies were identified. WuXi Biologics (2269.HK), one of the companies targeted,She is building a factory in her area of Massachusetts.
China’s Foreign Ministry described the bill as “discriminatory” and said the United States should stop using “pretexts” to suppress Chinese companies.
“China will continue to firmly safeguard the legitimate rights and interests of its enterprises,” Commerce Ministry spokesman Mao Ning said at a regular press conference on Tuesday.
A WuXi Biologics spokesman said the vote and dissent reflect a better understanding among key lawmakers about the company’s role in the industry and its U.S. operations.
“We will continue to work to clean up our reputation,” the spokesperson said in a statement.
Wuxi Wuxi AppTec said in a statement that it was “disappointed” in the House vote and that “our company was prejudiced and unfairly designated without due process.”
On Tuesday, the share prices of Hong Kong-listed WuXi AppTec and WuXi Biologics fell 11% and 9%, respectively.
The US Senate Homeland Security Committee voted to approve a similar bill in March, but it is unclear when the full Senate will vote on the bill.
Target said the measure is based on false and misleading allegations and would stifle competition. They deny any threat to US national security and both have said they should not be included in the bill.
BGI said in a statement: “We are disappointed that the US legislative process is being used to pick winners and losers.” They also reiterated that there is no threat to national security.
Other companies named include China’s MGI and its California-based subsidiary Complete Genomics.
MGI said in a statement, “As we have repeatedly emphasized, MGI and Complete Genomics, as equipment suppliers, have no right to access, store or retain patient genetic data; our customers have no control over any data they generate.
A spokesperson for Complete Genomics said that “geopolitics rather than facts” helped the bill pass the House.
“We and many in the pharmaceutical and life sciences industries are deeply concerned about the impact this legislation could have on American leadership in biotechnology innovation, drug development, and patient care,” the spokesperson said.
