This article**: Times Weekly Author: Du Sumin.
Picture worm creativity
CXO leader WuXi AppTec (603259sh；02359.HK) is still fermenting over being included in the US "sanctions list".
On February 5, in response to the "Biosecurity Act Proposal" (Biosecure Act) and related content proposed by the U.S. House of Representatives, WuXi AppTec's official WeChat account *** issued another response. In an open letter from WuXi AppTec's management team to clients, WuXi AppTec described the recent turmoil as "baseless and misleading groundless allegations" and "unsubstantiated allegations".
In the article, WuXi AppTec once again emphasized that WuXi AppTec has not, is and will not pose a risk to any country in the past. The United States** has identified certain companies as posing a risk to the United States and imposed sanctions on them. However, WuXi AppTec has never received such designation or been subject to sanctions.
The draft legislation is still under consideration, and we are actively communicating with relevant parties to clarify the unfounded and misleading allegations against the company. We believe that when fully informed of the facts, members of the U.S. Congress will understand that WuXi AppTec does not pose a risk to any country. WuXi AppTec said.
The Times reporter noticed that the open letter was signed by Li Ge, chairman and CEO of WuXi AppTec, Chen Minzhang, co-CEO of WuXi AppTec, and Yang Qing, co-CEO of WuXi AppTec. According to the annual report, Li Ge is the founder of WuXi AppTec, born in 1967 and is now an American citizen. In 2023, the Li Ge family will be selected into the 2023 Hurun Global Rich List with 52.5 billion yuan.
Source: WuXi AppTec's official WeChat***
The turmoil dates back to January 26. In the afternoon of the same day, WuXi AppTec's A-shares crashed and stopped, and Hong Kong stocks also fell by more than 30% intraday, and the stock prices of related pharmaceutical sectors also plunged. While the uninformed are still wondering why WuXi AppTec encountered another "Black Friday", a screenshot of a "bill prohibiting contracts with certain biotechnology companies and other purposes in the United States" has been circulated in the market, including the transfer of BGI (300676SZ), WuXi AppTec and other companies included in the list of "Biotech Companies of Concern".
In the afternoon of the same day, WuXi Biologics (02269HK) CEO Chen Zhisheng explained in response to **, "This is just a proposal by an anti-China parliamentarian, and it is a very unlikely event to become law, and it will take several years." I personally have not served in any military body. We will make an announcement as soon as possible to clarify. ”
On the evening of January 26, WuXi AppTec's clarification announcement arrived as scheduled. According to the announcement, the company noted that in a draft version of the Biosafety Act (the "Bill") submitted to the U.S. House of Representatives on January 25, 2024, Medica AppTec was mentioned. A similar draft bill was recently introduced in the U.S. Senate. The draft bill has not yet entered into force and has been enacted, and the subsequent legislative process requires the House of Representatives and the U.S. Senate to vote on their respective versions of the bill to form a final version after being reviewed by the relevant committees.
As a result, the content of the draft bill, including the reference to the Company, is subject to further consideration and possible changes. Together with our consultants, we are closely following the progress of the legislative process for this draft. WuXi AppTec said.
With regard to certain elements of the draft bill that refer to WuXi AppTec, WuXi AppTec also emphasized that the Company believes that such content is neither appropriate nor accurate. The Company firmly believes that WuXi AppTec's business development does not pose a risk to the security of any country.
However, the statement still did not ease investors' concerns. On January 29, WuXi AppTec continued to fall sharply, among which, A-shares fell again, and Hong Kong stocks fell by more than 16%.
At about 6 a.m. on January 30, WuXi AppTec issued another announcement and made a detailed clarification on the content of WuXi AppTec in the draft biosafety law. According to the announcement, the company firmly believes that WuXi AppTec's business will not pose a risk to any country; The company has not sponsored conferences or other activities on the theme of civil-military integration; The Company has never received any direct investment in civil-military integration**.
In addition, for the WuXi AppTec Life Chemistry Research Award, which was established in 2007, WuXi AppTec also emphasized that the objective selection criteria of the award are only related to scientific research experience, scientific research capabilities and scientific research achievements, and will not give special consideration to the background or employment unit of any candidate.
Repeated clarifications have not stopped the turmoil. On February 2, WuXi AppTec's A-shares fell again, and Hong Kong stocks fell by more than 20% again. According to the "Science and Technology Innovation Board", on the same day, Bank of America Merrill Lynch's U.S. medical policy analyst in Washington said at the ** meeting that once the U.S. House of Representatives' "Biosecurity Act" proposal is legislated, the depth of impact on the industry may be greater than expected.
Meanwhile, another proposal for a Biosecurity Act (S.) was presented by U.S. Senator Gary Peters on December 20, 20233558, the "Senate version of the Biosecurity Act") has received votes from six additional senators as of February 2, who have become co-sponsors of the proposal.
According to the above-mentioned report, this proposal, like the "Biosecurity Act" sponsored by the above-mentioned House of Representatives, mentions BGI and its subsidiaries, as well as WuXi AppTec and other companies, and explicitly requires that some projects in the United States be prohibited from using equipment and services from named companies.
On February 4, a number of ** quoted foreign media reports that a bill that triggered the sell-off of some Chinese biotechnology companies was postponed in the Senate this week. A U.S. Senate aide said the bill would not pass the committee for at least a few weeks.
After the news that the U.S. Senate postponed the consideration of relevant bills, on February 4, WuXi AppTec issued a clarification announcement for the third time, saying that the company had noticed the fluctuations in the company's trading volume in recent days. The Board of Directors confirmed that the Company's production and business activities are normal and there are no significant changes in daily operations.
WuXi AppTec once again emphasized that the company does not have a human genomics business, and the company's existing businesses do not collect human genome data. Moreover, the company is not affiliated with any ** or its military organization. "The Company firmly believes that WuXi AppTec has not, is and will not pose a significant risk to any country in the past, and therefore should not be pre-defined as a 'biotech company of concern' in the Draft." It is worth mentioning that WuXi AppTec also deliberately bolded and underlined the line "not in the past, not in the present and not in the future".
On February 5, WuXi AppTec's A shares closed at 4823 yuan shares, down 396%；Hong Kong stocks closed at 45HK$45 shares, up 400%。