By Sneha S K
(Reuters) -China’s WuXi Biologics said on Monday it will sell its vaccine facility in Ireland to U.S. drugmaker Merck & Co for about $500 million, ahead of potential U.S. legislation that would restrict business for Chinese biotech companies.
The U.S. House of Representatives passed the Biosecure Act in September, which would ban federal contracts with targeted firms and their business partners.
The legislation, which explicitly names WuXi, must pass the U.S. Senate before it can be sent to the president to be signed into law.
“They (WuXi) are looking to reduce their scope and perhaps preparing for reduction in contracts,” BTIG analyst Justin Zelin said.
The Financial Times had reported in October that WuXi and WuXi AppTec are planning to sell some of their operations.
“Especially with the newly entering administration being increasingly hawkish against China specifically … there is broad support for the act conceptually. But it will need to find a larger legislative vehicle to become law,” Zelin added.
The bill is designed to keep Americans’ personal health and genetic information from foreign adversaries and encourage U.S. pharmaceutical and biotech companies to reduce their reliance on China for drug ingredient manufacturing and early research.
WuXi AppTec had said in December its units had signed a deal with U.S.-based private equity firm Altaris LLC for the sale of the U.S. and UK-based operations of its cell and gene therapy unit.
(Reporting by Sneha S K; Editing by Krishna Chandra Eluri and Tasim Zahid)
