China’s WuXi Biologics shares suspended after inclusion on US list prompts 32% drop

 Shares in pharmaceutical company WuXi Biologics were suspended on Tuesday after plummeting by as much as 32 per cent, their biggest ever single-day decline.

Washington on Monday added WuXi and 32 other Chinese groups to a list curbing its ability to access US technology.

US companies face greater restrictions in exporting goods to groups on the list, and are required to conduct more stringent due diligence checks in their dealings with them.

The commerce department adds groups to the list if it cannot verify the end use of goods exported to them. WuXi’s shares fell to as little as HK$59.20 (US$7.59) following the announcement.

The addition of 33 Chinese companies to the so-called “unverified list” comes as the US steps up its scrutiny of Chinese groups amid worsening trade relations between the two countries.

In December, the US added eight Chinese companies to its investment blacklist and 11 biopharmaceutical organisations to its “entity list”, which bans US companies from exporting banned technology originating in America to them.

“WuXi Biologics has been importing certain hardware controllers for bioreactors and certain hollow-fibre filters that are subject to US export controls but have received [US] approval for the last 10 years,” WuXi said on Monday, adding that it did not expect its inclusion on the list to affect its business operations.

https://www.ft.com/content/6fb09fcd-f392-43dd-b3f4-0ea79bd3d335