(Bloomberg) -- WuXi AppTec Co. generated 65% of its 2023 sales from the US, revenue that’s under threat by American political efforts to cut ties with Chinese biotechnology companies.

The US accounted for 26.1 billion yuan ($3.6 billion) of WuXi’s sales last year, compared with 25.9 billion yuan a year earlier, the Shanghai-based company said in a statement. Excluding Covid-19 projects, US sales increased 42% from 2022, the company said. 

Lawmakers in the US are considering bills that would ban Chinese biotechnology companies “of concern,” or any pharmaceutical company that works with them, from getting federal contracts in an effort to ensure national security. WuXi AppTec and several other companies are named in the legislation. Legal and industry experts say the measures, if passed, would sever ties between the companies and the larger industry.

Reliance on contract research, development and manufacturing organizations like WuXi AppTec became clear during the pandemic. WuXi saw a surge in projects related to the global public health emergency, particularly in America, with US sales including those tied to Covid projects soaring 113% in 2022 after a 37% rise in 2021. 

WuXi AppTec’s sales from the top 20 global pharmaceutical firms were 16.1 billion yuan verses 18.4 billion yuan a year ago, the company said. It has repeatedly voiced objections to the allegations by lawmakers in Washington, saying it doesn’t pose a national security risk. 

The company’s net income increased 21% to 10.7 billion yuan under IFRS accounting standards, beating analysts’ expectations. Full-year global sales were 40.3 billion yuan, up 2.5% from a year ago, it said. 

The company dealt fresh blow when BIO, the world’s largest trade group for the biotechnology industry, said it will support the US Biosecure Act. WuXi AppTec ended its membership in a March 12 letter to the group.

The bill was advanced by a US Senate committee earlier this month, but it must pass both chambers of Congress and get the president’s signature before becoming law. 

Goldman Sachs downgraded WuXi AppTec to neutral from buy and slashed its target price for the stock because of the US bill earlier this month. 

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