(Yicai) May 13 -- Shares in WuXi AppTec rebounded today after the US Congress released the latest version of its Biosecure Act, in which the Chinese biotech company is listed as a ‘biotechnology company of concern,’ that extends the period by which US businesses must decouple from blacklisted firms by eight years.

WuXi AppTec’s Shenzhen shares [SHE:603259] closed up 3 percent at CNY46.19 (USD6.38). Earlier in the day the price surged 8.5 percent to CNY48.68. Its Hong Kong-listed stock [HKG:2359] closed up 4.5 percent at HKD39.80 (USD5), having soared as much as 15.5 percent to hit HKD44 in the morning.

The mainland stock has lost more than 36 percent of its value so far this year since the draft act, which aims to prevent foreign countries from stealing the genetic data and personal health information of US citizens, was released in December last year. 

The revised bill still restricts US entities from linking arms with Chinese biotech companies, including WuXi AppTec and BGI Group, but the deadline has been extended to January 2032 to give US companies more time to find new partners, according to the latest draft released on May 10. It moves to the US House of Representatives for their vote on May 15.

The US is determined to force local companies to reduce their dependence on Chinese suppliers, a US investor told Yicai. However, as it takes time to adjust the supply chain, businesses cannot cut ties with Chinese suppliers immediately. Instead, they have to do this in stages, he added.

Wuxi AppTec’s net profit plunged 10 percent in the first quarter from a year earlier to CNY1.9 billion (USD263 million), while revenue sank 11 percent CNY8 billion, according to the firm’s latest financial report.

More than half of the Wuxi-based company's revenue in the first three months, at CNY4.9 billion (USD677.3 million), came from US customers. This was a gain of 0.4 percent from a year ago when excluding its Covid-19 products.

In 2023, WuXi AppTec’s income from its US customers surged 42 percent from the year before to CNY26.1 billion (USD3.6 billion), not including its Covid-19 products, according to the firm’s latest annual report. This accounted for 65 percent of total revenue.

Editor: Kim Taylor