Biotech Companies WuXi AppTec and WuXi Biologics Surge Following Potential Divestment Amid U.S. Legislation
Market Surge of Biotech Companies
Shares of WuXi AppTec and WuXi Biologics experienced substantial gains, attributed to their plans to divest some operations amidst heightened legislative scrutiny. WuXi AppTec's shares surged nearly 12% reaching HK$67.10, while WuXi Biologics saw a nearly 15% increase to HK$21.45.
Session Highlights
- WuXi Advanced Therapies, a division of WuXi AppTec, is on the market.
- WuXi Biologics is exploring interest in its European production sites.
- Both companies aim to mitigate risks from the Biosecure Act, pending Senate approval.
Legislative Background
The U.S. House of Representatives passed a bill that targets several Chinese biotech companies, including WuXi and BGI Group. This legislation could hinder operations of these firms if enacted.
Tension in the Biotechnology Sector
The Biden administration has stressed the need to cut ties with foreign entities that pose potential risks to national security. Chinese biotech firms have found themselves in a challenging geopolitical landscape, as export restrictions increase.
Financial Performance Report
Despite recent gains, WuXi companies have faced declining revenue reflecting broader industry challenges. In the first half of the year, WuXi AppTec reported a revenue drop of 8.6%, highlighting the impact of ongoing legislative changes.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.