(Yicai) March 14 -- WuXi AppTec’s shares sank after a US-based biotechnology trade association said it would remove the Chinese company from its membership roster and support the US Biosecure Act.

WuXi AppTec [SHA: 603259] ended 5.7 percent lower at CNY53.51 (USD7.44) in Shanghai today, extending the decline to 26 percent so far this year, while its Hong Kong-listed stock [HKG: 2359] plunged 12.1 percent to HKD44.95 (USD5.75), bringing its retreat to 43 percent.

The Biotechnology Industry Organization said it will support the Biosecure Act and work with the US Congress as the legislation progresses, the New York-based organization said in a statement yesterday. The BIO is taking steps to separate from WuXi AppTec regarding membership in the organization, it added.

The BIO is the world's largest biotechnology organization, providing advocacy, business development, and communications services for more than 1,200 members worldwide, according to its introduction on LinkedIn.

The Biosecure Act aims to prevent foreign countries from stealing the genetic data and personal health information of American citizens. It was introduced last December and won approval from the Senate Homeland Security and Governmental Affairs Committee on March 6. The bill puts several Chinese biotech firms, including WuXi AppTec, on a list of “biotechnology companies of concern” to prevent them from getting US government funding.

WuXi AppTec has repeatedly said that its business poses no security risk to any country and said it will continue to talk with the parties involved in the legislative process in the coming months. Changes to the bill are still possible, the Shanghai-based firm said on March 7.

WuXi AppTec’s shares have plummeted several times this year due to the proposed bill, as the largest chunk of its revenue comes from US clients. It mainly provides outsourcing services for pharmaceutical firms to research and develop new drugs.

The company had revenue of CNY19.4 billion (USD2.7 billion) from US customers in the first three quarters of last year, up 36 percent from a year earlier, and accounting for 66 percent of its total income, according to its third-quarter earnings report last year.

According to the US legislative process, the bill still needs to be voted on and passed by both the Senate and the House of Representatives and signed by President Joe Biden before it can become law.

Editor: Tom Litting