A bill working its way through Congress could enforce a deadline for U.S. companies to cut ties with several Chinese biotech firms.
The Biosecure Act was approved by the House Committee on Oversight and Accountability earlier this month and is expected to cause major upheaval in the U.S. biotech industry if it’s ultimately passed by Congress and signed into law.
U.S. biotechs rely heavily on Chinese manufacturing to shore up the industry’s supply chain of critical goods and drugs. The country had the world’s third-largest biopharmaceutical manufacturing capacity in 2020, according to the Brookings Institute. And a whopping 79% of 124 biopharma companies surveyed in May had at least one contract or product with a China-owned or China-based contract manufacturer, according to BIO.
With the latest version making headway in the House — after already passing committee in the Senate — the potential impact of the bill, which is aimed at limiting contact with companies that could be linked to national security concerns, is taking shape.
A 2032 deadline
The bill’s revised version gives biotechs more time to end existing contracts with five specific Chinese biotechs, pushing the deadline back to 2032.
The timeline reflects BIO’s survey outcomes, which found U.S. biotechs believe they would need up to eight years to change manufacturing partners.
“As we advance toward strengthening the resilience of our biomanufacturing industry in the United States, we need as well to ensure an uninterrupted pathway to patient access to life-saving therapies for the millions of patients impacted,” BIO CEO and president John Crowley said in a statement. “As we redomicile manufacturing in this country, we will work closely with Congress to pursue a comprehensive set of policies and long-term commitments to increase state-of-the-art domestic biomanufacturing capacity and capabilities nationwide and retain our position as the medicine chest to the world.”
The bill specifically names WuXi Apptec and its affiliates such as WuXi Biologics, which are important partners for U.S. biotechs and develop up to 25% of drugs used in the U.S. The bill would also force U.S. companies to sever ties with MGI, BGI and Complete Genomics.
Congress named five entities in the bill that “all are part of either the BGI group or the WuXi group,” said Representative Raja Krishnamoorthi (D-IL) when discussing the latest version of the bill at the House Oversight and Accountability Committee markup hearing on May 15.
Krishnamoorthi stated the U.S. government has found both BGI Group, the world’s largest genome research organization, according to the company, and WuXi affiliates to “be involved in the perpetration of human rights abuses.”
BGI has also been accused of collecting data and intellectual property, and sending it back to China and WuXi AppTec “to be replicated.” The bill requires the Office of Management and Budget to create a list of foreign adversary controlled biotech companies considered to be of national security concern, prohibits executive agencies from contracting or spending money with these companies, and stipulates that U.S. companies would not be able to receive grant money if they work with the named Chinese biotechs and their affiliates.
Moving forward
The House is aiming to vote on the bill before members leave for the July 4 holiday, STAT News reported, and could be passed before the end of the year as part of another legislative package, possibly the National Defense Authorization Act.
However, the Biosecure Act is not a done deal, and WuXi Biologics and WuXi AppTec are actively lobbying Congress to stop its passage. Both have argued they did not mishandle or transfer intellectual property.
The bill’s movement comes as the U.S.’s manufacturing industry faces pressure from record-high drug shortages. As demand continues to rise for ADHD drugs and weight loss GLP-1s, manufacturers are struggling to keep up. Now, companies that aren’t ramping up production in the U.S. may confront challenges working with partners abroad.
According to BIO’s survey, the most complicated manufacturing changes will be for already-approved medicines, which have “very limited biomanufacturing alternatives” on par with Chinese contractors. Thirty percent of survey respondents said they had programs and contracts with Chinese biotechs for manufacturing approved medicines, signaling that the bill could introduce new supply constraints.
