WuXi AppTec and WuXi Biologics get reprieve in latest version of BIOSECURE Act

The BIOSECURE Act, which the House of Representatives overwhelmingly passed in 2024 but failed to include in last year’s military spending package, has been proposed as an amendment to the Fiscal Year 2026 National Defense Authorization Act (NDAA). However, unlike prior legislative drafts, the amendment does not specifically name WuXi AppTec and WuXi Biologics as biotechnology companies of concern to U.S. national security.

In the previously proposed BIOSECURE Act, five Chinese companies were blacklisted — BGI (formerly known as the Beijing Genomics Institute), Complete Genomics, MGI, WuXi AppTec, and WuXi Biologics — for the purpose of barring them from U.S.-funded research and contracts. At the time, some members of Congress objected to naming specific China-based companies in the legislation.

To address these objections, an amendment to the FY26 NDAA declined to name the firms allegedly linked to China’s government and instead refers to entities included in the latest list of “Chinese military companies” maintained by the U.S. Department of Defense (DoD), which does not include Complete Genomics, WuXi AppTec, or WuXi Biologics but does include BGI and MGI.

The amendment states that any entity included in DoD’s 1260H list of Chinese companies operating directly or indirectly in the U.S. — entities that DoD has determined are either directly or indirectly owned by, controlled by, or acting on behalf of China’s military — are ineligible for U.S. government contracts or funding, according to a Sept. 3 alert from law firm Ropes & Gray.

“The majority of the bill has remained unchanged from the most recent version of the 2024 Act passed by the House of Representatives,” the law firm stated in its alert. “Although the BIOSECURE Act stalled in Congress in 2024, it may be gaining momentum in 2025. The House and Senate are each expected to vote on their respective versions of the NDAA when they return from the congressional recess in September.”

BIOSECURE Act language was not included in the version of the House NDAA passed last week. The Senate is considering its own proposed NDAA. Once the Senate passes its draft of NDAA, the House and Senate will engage in a reconciliation process.

Lawmakers in 2024 included a five-year grandfathering clause that would allow existing contracts with impacted Chinese companies, providing some leeway for U.S. firms to make other arrangements. The latest version of the BIOSECURE Act also provides a five-year window from the effective date of the bill to allow decoupling from companies of concern in China for contracts already in place.   

“Should the Amendment be included in both the House and Senate NDAA bills that are passed, companies in the life sciences, biotechnology, and health care sectors should prepare to undertake a comprehensive review of their existing and planned contractual relationships, supply chains, and collaborations involving biotechnology equipment or services,” Ropes & Gray advised.

Nuvama Institutional Equities in a Sept. 12 update to investors noted that the previous version of the BIOSECURE Act “led to increased inquiries and project wins by Indian CDMOs” and that the latest draft “can again bring the focus back on the supply chain security for innovators, potentially benefitting Indian companies once more.”

While the current draft of the BIOSECURE Act is a “diluted version” of its predecessor, Nuvama said that if approved, the legislation “can prohibit certain biotech companies of concern of Chinese origin.” The firm views India’s Divi’s Laboratories, Jubilant Pharmova, and Neuland Laboratories as key beneficiaries. Nuvama also called out Aurigene, Syngene, and Aurobindo Pharma’s upcoming biologics CMO unit as potential beneficiaries.

China, WuXi AppTec in the crosshairs

The Office of the Director of National Intelligence (ODNI), in its annual threat assessment of the U.S. intelligence community released in March 2025, warned that China views biotechnology as critical to becoming a dominant economic power and intends to grow its domestic bioeconomy to $3.3 trillion this year. 

“Beijing is investing heavily in collecting health and genetic data both at home and abroad in pursuit of these goals, and has shown it can be globally competitive in certain low-cost, high-volume commodities, such as biomanufacturing and genetic sequencing,” according to ODNI’s report.

An April 2025 report to Congress from the bipartisan National Security Commission on Emerging Biotechnology (NSCEB) found that the U.S. lacks biomanufacturing capacity to ensure it maintains global dominance over China in the biotech industry. With China aggressively pursuing a strategy to become the world’s biotech leader, the U.S. government must invest a minimum of $15 billion over the next five years, according to NSCEB. 

The report concluded that U.S. biomanufacturing faces several barriers including regulatory hurdles, inefficient biological yields, lack of standardization, and “limited domestic scale-up capacity” as “researchers are generating new products faster than manufacturing capacity is increasing.”

China is doubling down on its biomanufacturing investment in 2025. Having invested $4.17 billion in the sector in 2024, Chinese biomanufacturing is poised for “significant” growth this year, according to an announcement in December 2024 from China’s Ministry of Industry and Information Technology.

NSCEB called out WuXi AppTec as having “benefited greatly” from Chinese government support. With 38,000 employees and nearly $6 billion in revenue, WuXi AppTec is “so entrenched in American biopharmaceutical supply chains that American firms estimate they would need at least eight years to develop alternative sources for its services.”

The report cited 2024 survey results which found that 79% of U.S. biopharma companies depend on WuXi AppTec and other China-based firms for at least some component of their manufacturing.

Members of Congress and U.S. intelligence officials have warned that Chinese biotech companies may be collaborating with Beijing. Reuters reported last year that WuXi AppTec allegedly transferred U.S. intellectual property to the government of China without consent, citing unidentified sources.

“WuXi AppTec adheres strictly to U.S. laws and regulatory standards. We are not aware of, would never approve, do not condone, and have a zero-tolerance policy against any attempt to mishandle or transfer a customer’s intellectual property to any unauthorized party,” a company spokesperson said in an emailed statement.