[Young Journalist Sihyun Oh] As opposition in U.S. political circles to adopting Chinese-made memory products grows, concerns are also rising over the U.S. pharmaceutical and biotech industry’s “shopping spree” in China. This comes as the Biotech Investment National Security Act (BINSA), aimed at preventing the outflow of U.S. capital and technology to China, has been introduced and is drawing attention. 

U.S. senators recently sent a letter to Apple CEO Tim Cook, asking him to respond by the 21st on whether Apple uses products from Chinese memory chipmakers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC). They also demanded a pledge that Apple would not use memory produced by CXMT or YMTC in any of its products anywhere in the world. As these demands were included in a bipartisan letter, they reflect the views of both political parties as well as those of the Trump administration. 

The Biotech Investment National Security Act has also been gaining momentum recently through its bipartisan introduction in U.S. political circles. This move is interpreted as an effort to prevent China from taking the lead in the biotech industry by utilizing U.S. technology and capital. It is intended to counter China’s efforts to gain global dominance in areas such as electric vehicles and rare earth elements. 

The United States has focused on the Biosecure Act. While previous efforts focused on blocking parts of the supply chain, including pharmaceutical contract development and manufacturing organizations (CDMOs) and data leaks, this time the approach is based on the concept of national security, with the intention of preventing U.S. companies from “shopping in China.” 

Key regulatory provisions include ▲adding biotechnology to the scope of comprehensive outbound investment reviews, ▲making U.S. Treasury Department reviews mandatory for biotech transactions with China, and ▲requiring the Department of Defense to prepare reports assessing national security impacts. “Biotechnology” has officially been added to the list of areas subject to review under the existing foreign investment national security review system. The bill also requires all transactions involving U.S. assets or companies and China-related entities to undergo prior and subsequent reviews by the U.S. Treasury Department. This includes equity investments, joint venture formation, and pharmaceutical licensing agreements. 

Republican Senator Pete Ricketts stated the legislative intent, saying, “We cannot allow China to obtain the resources it needs to threaten our way of life, and we will prevent any attempt to weaponize U.S. capital to undermine companies and disrupt supply chains.”

Democratic Senator Elissa Slotkin also mentioned, “China is currently posing a significant threat to the United States’ position in the biotech sector. We must protect U.S. technology and capital so that China cannot replicate in the biotech sector what it did by dominating the automobile and drone markets.” 

Recently, concerns have been raised over national security as major U.S. pharmaceutical companies have increased their reliance on Chinese biotech companies. In May, Pfizer signed an agreement with China’s Innovent Biologics to jointly develop an anticancer drug, reaching a deal to pay $650 million (approximately 890 billion won) as an upfront payment.

Bristol Myers Squibb (BMS) has also signed a joint development agreement with Chinese pharmaceutical company Hengrui, worth up to $950 million (approximately 1.3 trillion won).

According to data analytics company Evaluate, the upfront payments made by global pharmaceutical companies such as AbbVie, AstraZeneca, and Eli Lilly to Chinese companies have exceeded $2.5 billion (approximately 3.4 trillion won) so far this year.

Thus, as global big pharmaceutical companies have increasingly moved to acquire promising assets from Chinese biotech companies to find breakthroughs in research and development (R&D), U.S. political circles have begun to gain momentum to counter this trend, including introducing the National Security Act.

Meanwhile, there are also predictions that South Korean pharmaceutical and biotech companies could benefit from the spillover effects of strengthened U.S. regulations on Chinese biotech companies. Analysts say that U.S. pharmaceutical companies may increasingly consider introducing drug pipelines owned by biotech companies in South Korea and Europe as alternatives to Chinese companies.

The U.S. is strengthening regulations on Chinese biotech companies to prevent U.S. capital and technology from flowing into China and to protect national security. 

A bipartisan bill, the Biotech Investment National Security Act (BINSA), would expand investment reviews and require scrutiny of transactions such as equity investments, joint ventures, and pharmaceutical licensing agreements. 

This move comes as major U.S. pharmaceutical companies have increased their partnerships with Chinese biotech companies and invested billions of dollars in their drug pipelines. 

South Korean and European biotech companies are expected to benefit as potential alternatives to Chinese companies, creating new opportunities for the Korean pharmaceutical and biotech industries.

▶원문 기사:애플처럼 중국 겨냥 초당적 발의 '미 바이오 국가보안법', 한국에 반사이익?

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