With the BIOSECURE Act likely to be voted on in Congress this year, WuXi AppTec’s U.S. revenue dropped 1.2% in the first half of 2024 while the Chinese company increased its lobbying efforts.
WuXi AppTec announced Monday in its first-half of 2024 results a 1.2% decrease in U.S. year-over-year revenue, as the BIOSECURE Act targeting Chinese companies appears to be close to passage in Congress.
The China-based contract researcher and manufacturer revealed in a presentation that it pulled in RMB $10.71 billion in revenue from the U.S. in the first half of its fiscal year, which marked a slight decline. However, the market is a major contributor to overall revenue with 62% coming from the U.S.
At the same time, WuXi AppTec saw revenue boosts in Europe and China, rising by 5.3% and 2.8% from last year, respectively. Revenue in Japan, Korea and other countries only reached $91 million, a more than 17% decrease from last year.
WuXi AppTec brought in RMB 9.25 billion ($1.2 billion) in the second quarter of 2024, a slight 0.3% year-over-year increase. The company also noted that “despite external challenges” it maintained “stable operations” in the first half of 2024. However, the potential threat from the BIOSECURE Act is still looming for the company.
The proposed bipartisan legislation was introduced earlier this year to ensure that “foreign adversary biotech companies” did not get access to U.S. taxpayer dollars and labeled WuXi AppTec and its subsidiary WuXi Biologics to be a companies of concern.
In a speech at the Hudson Institute earlier this month, U.S. House of Representatives Speaker Mike Johnson (R-La.) announced that he is working to advance the bill and intends to bring it to a vote on the House floor sometime in the fall.
In the company’s presentation released on Monday, one of the slides noted that the BIOSECURE Act “involves uncertainty” but multiple steps remain in the legislative process before it becomes law. It also noted that WuXi AppTec has been “actively working” with advisors to “set the record straight” and advocate for changes.
“Although the recently proposed U.S. legislation may create short-term uncertainty for the company, our customers, and the global pharmaceutical and life sciences industry, WuXi AppTec remains steadfast in ‘doing the right thing and doing it right’ and committed to continuously enhancing our capabilities and capacity as we support the industry and our customers to bring groundbreaking therapies to patients around the world,” CEO Ge Li said in a statement.
WuXi AppTec and WuXi Biologics have been ramping up their lobbying efforts in the U.S. A report from Korea Biomedical Review found that Wuxi AppTec’s lobbying efforts have increased from $100,000 in the fourth quarter of 2023 to $360,000 in the second quarter of 2024. Meanwhile, WuXi Biologics also boosted its lobbying spend from $40,000 in the third quarter of 2023 to $165,000 by the second quarter of 2024.
WuXi AppTec reiterated in Monday’s presentation that it disagrees with being labeled a company of concern “without due process” and says it complies with the laws and regulations in all countries where it operates.
