Despite Pentagon's recent blacklisting of WuXi AppTec,analysts expect multinational pharma companies to keep working with Chinese firms. U.S . Department of Defense added WuXi AppTec to its list of entities allegedly linked to Chinese military, expanding roster from 134 to 188. This move likely won't stop global drug makers from using China's cost advantages.
Cui Cui,head of healthcare research for Asia at Jefferies, said blacklist impact would be minimal. “Multinational companies in pharma still prefer made-in-China for cost efficiency,” she stated. She also noted WuXi AppTec's earnings visibility remains intact,suggesting company can maintain operational stability despite political pressures.
This isn't first time U.S. targeted Chinese biotech firms. The BioSecure Act,introduced late 2023, initially named five Chinese life-sciences companies, including WuXi AppTec,as barred entities for federal contracting. But when bill was signed into law in December,all five names were removed,showing complexities of U.S.-China relations in healthcare sector.
On stock market,WuXi AppTec's shares saw volatility,dropping as much as 5.2% on Tuesday before closing down 3.7% at HK$116.80. By Wednesday morning,stock rebounded,rising 2.3% to HK$119.5. Industry players remain optimistic that push to enhance patient outcomes and reduce costs will ultimately outshine political hurdles…
