China’s WuXi AppTec Divests Cell and Gene Therapy Unit Amidst National Security Concerns
In a significant move, WuXi AppTec, a Chinese biotech giant, has agreed to sell its cell and gene therapy manufacturing unit, WuXi Advanced Therapies, to U.S.-based private equity firm Altaris LLC. The deal’s financial terms remain undisclosed.
U.S. National Security Concerns Drive Regulatory Changes
This development comes amidst growing concerns over national security in the United States. Chinese firms, including WuXi AppTec, have been at the center of new U.S. laws aimed at restricting their businesses in the country. The U.S. House of Representatives passed a bill in September that would prohibit federal contracts with targeted firms and those that do business with them.
Protecting American Health and Genetic Information
The primary objective of these bills is to safeguard Americans’ personal health and genetic information from foreign adversaries. By doing so, the U.S. government aims to encourage pharmaceutical and biotech companies to reduce their reliance on China for various aspects of their operations, including drug ingredient manufacturing and early research.
WuXi AppTec’s Diversification Strategy
As part of the deal, WuXi AppTec will also divest Oxford Genetics, the UK-based operating entity of the WuXi ATU business, to Altaris LLC. This move is seen as a strategic step by WuXi AppTec to diversify its business portfolio and mitigate potential risks associated with the changing regulatory landscape.
Silence from WuXi AppTec and Altaris LLC
Despite requests for comment, neither WuXi AppTec nor Altaris LLC has responded to queries from Reuters. The deal’s implications on the biotech industry and national security concerns will likely be closely watched in the coming months.
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