China hawks in the US House overcame a last-ditch lobbying effort and passed legislation Monday night that would blacklist Chinese biotech companies and their US subsidiaries, Report informs referring to Bloomberg.
The bill, approved by a vote of 306 to 81, now goes to the Senate.
At stake, the bill’s backers argued, is whether a rival will dominate another field the US pioneered, amid fears China could engineer bioweapons or otherwise capitalize on biological data vacuumed up from the rest of the world.
The legislation which passed the House Oversight Committee 40-1 in May, would affect five companies to start: BGI Group, BGI spinoffs MGI Tech Co. and MGI’s US subsidiary Complete Genomics Inc., WuXi AppTec Co., and WuXi Biologics.
On Tuesday, WuXi AppTec and WuXi Biologics said they did not pose a security risk to the US or any nation, according to filings to the Hong Kong stock exchange.
Shares of Wuxi Biologics slid as much as 8.6% while WuXi AppTec tumbled 11% in Hong Kong. The declines also dragged other biotech shares lower.
Dubbed the Biosecure Act, the measure is the latest power flex by lawmakers who have already succeeded this year in requiring Chinese-based parent company Bytedance Ltd. to divest from TikTok or face a US ban on the popular social media site.
Bloomberg Intelligence gives the biosecurity bill a 70% chance of becoming law given strong support in both the House and the Senate. Numerous other bills targeting China are set for votes this week, including legislation targeting the Chinese supply chains for electric vehicles as well as other industries.
The companies, whose stocks have fallen this year amid the blacklisting effort, have argued they aren’t a national security threat and are focused on health innovation.