The Postponement Of The Bill At The US Congress Has Resulted In A Decline In Shares Of The WuXi AppTec Biotechnology Company

A bill at the US Congress that sparked the sale of shares of Chinese company WuXi AppTec has been delayed in the Senate this week. This was said by a Senate aide and three other sources on Friday.

The bill will ban federal agencies from contracting with BGI Group, MGI, Complete Genomics, WuXi AppTec, their subsidiaries, and other biotechnology companies of concern. The bill will also stop governments from contracting with companies that use their equipment or services.

This caused WuXi AppTec's shares to drop 21% overnight.

The bill sponsored by Democratic Senator Gary Peters, did not leave the committee this week, as expected. The bill will be considered on the coming date, said a majority aide to the Senate Committee for Domestic Security and Government Affairs, chaired by Peters.

The bill is not expected to be out of the committee for at least a few weeks, another congress aide said.

The accompanying bill proposed by Republican Congressman Mike Gallagher, chairman of China's House on select committee, accused the companies of assisting the Beijing military.

No date has yet been set to remove the House Bill from the committee, the congressional aide said.

Chinese biotechnology companies pose a threat to how sensitive American data and personal health information can be accessed by the Chinese Communist Party, Senate aides said on Friday.

Shares of WuXi AppTec and WuXi Biologics fell on Friday as investor concerns escalated against a bill targeting the Chinese biotechnology giants.

WuXi AppTec, which provides research and drug development services, has denied ties to the Chinese military and said its business does not pose a national security risk to any country.

WuXi AppTec said last week that the company-related content in the US bill on biosecurity was inappropriate or accurate. The company "supervised closely" the development of the bill, the company said in a filing to the Shanghai exchange.

BGI Group said last week that it supports personal data protection, but the bill "which will eventually expel BGI from the US market will not achieve this goal." The company added that in the US, they do not collect patient samples or have access to personal or genetic data.

BGI Group units appeared on the US Commerce Department's export control list on charges that they led to a "significant risk" to contributions to China's government oversight.