The Chinese Communist Party is a threat
to America’s national and economy security. I look forward to voting on legislation this week that counters China’s aggression, deters future actions, and better protects our homeland. https://t.co/bmYFtzjEpn— Daniel Webster (@RepWebster) September 9, 2024
The U.S. House of Representatives passed a bill that would restrict some Chinese biotech firms from accessing U.S. capital markets. This move led to a fall in shares of these companies. The bill aims to address national security concerns related to China’s biotech industry.
New law in the US will make drug companies stop doing business with some Chinese biotechs within eight years if they want to remain in good standing with the federal government. https://t.co/iWy96D62kk
— Albert Vilella (@AlbertVilella) September 10, 2024
It would require the Treasury Department to create a list of Chinese biotech companies that pose a threat to U.S. national security. Once on the list, these firms would face restrictions on accessing U.S. capital markets. This could include being banned from listing on U.S. stock exchanges or raising money from U.S. investors.
Shares of several Chinese biotech companies fell sharply after news of the bill’s passage. Investors are concerned about the potential impact on these firms’ ability to raise capital and grow their businesses.
#OnETNOW | Will the BIOSECURE Act shift billions in pharma revenues from China to India? Vishal Manchanda of Systematix Group sees new players like Jubilant Pharmova set to benefit!@_anishaj @nikunjdalmia https://t.co/hXzyKsJvMv
— ET NOW (@ETNOWlive) September 10, 2024
“This bill sends a clear message that we will not allow China to exploit our capital markets to advance their biotech industry at the expense of U.S. national security,” said Representative Mike Gallagher, a sponsor of the bill.
This week, @HouseGOP is taking bold action to protect American security and values from the CCP’s aggression. From securing our supply chains to defending human rights, we’re ensuring America is strong on the world stage. https://t.co/ZECc8uwzYS
— Congressman Nick Langworthy (@RepLangworthy) September 9, 2024
Restricting Chinese biotech in US
The bill still needs to pass the Senate and be signed by the President to become law. However, it reflects growing concerns in Washington about China’s biotech ambitions and the potential risks they pose.
China has made significant investments in its biotech sector in recent years. The country aims to become a global leader in areas like gene editing and precision medicine. Some U.S. officials worry that China could use these technologies for military purposes or to gain an economic advantage over the U.S. They argue that restricting access to U.S. capital markets is necessary to protect national security interests.
Critics of the bill say it could harm U.S. investors and companies that do business with Chinese biotech firms. They argue that it could also damage the competitiveness of U.S. capital markets. The passage of the bill comes amid rising tensions between the U.S. and China on a range of issues, from trade to human rights.
It remains to be seen how China will respond to this latest move by the U.S. Congress.
- Bloomberg.”US House Passes Bill to Blacklist Some China Biotech Firms”.
- C-SPAN.”Morning Hour”.
- FT.”Live news: Chinese biotech shares fall after US House passes restrictive bill”.