On September 9, the House of Representatives of the United States Congress returned from a summer break and immediately scheduled a series of legislative votes, including the draft Biosafety Act (H.R. 8333). The draft biosecurity law passed the House of Representatives with 306 votes in favor and 81 votes against, but the 70% support rate made it the most divisive draft bill in the same batch, and even narrowly fell below the "bottom line" of more than two-thirds of the votes to pass the bill.

The draft Biosafety Act places five companies, including WuXi AppTec and WuXi Biologics, on the list of "biotechnology companies of concern" on the grounds of "national security", and intends to restrict the use of funds, loans or subsidies from the United States government to cooperate with these companies.

Unlike previous committees that voted in small groups, this time there were several members of the House of Representatives who publicly expressed their opposition to the bill. Congressman Jake Auchincloss from Massachusetts said in an interview with BioCentury that the bill only has a bad "stick" and no "carrots" because it doesn't tell how to fill the capacity gap between WuXi AppTec and WuXi Biologics, and if we ban cooperation with these companies, it will be difficult to meet the actual needs of the industry, "We have seen that drugs are getting more expensive and less accessible, and we don't want to disrupt the supply chain. It's going to make things worse. ”

No matter how the world changes, what remains unchanged is patients' expectations for new and good drugs, and the trend of global cooperation in new drug research and development is irreversible.

Although the House of Representatives voted to pass the draft bill in a "stumbling manner", many people in the legal and pharmaceutical industries have made judgments after careful analysis: whether it is looking at the time left or observing the internal position of the Senate and House of Representatives, the probability of the final passage of the "Biosecurity Act" alone is very low; And even if it passes, the impact on CXO companies such as WuXi AppTec will be limited.

First of all, why is the probability of the final passage of the draft bill so low? According to the United States legislative process, after the draft bill is proposed, it must first be submitted to the corresponding committee for revision and hearing, and then voted on in the House of Representatives and the Senate respectively, and then the two houses will be unified after it is passed, and finally signed by President United States before it can be officially enacted into law.

The draft Biosecurity Act was co-sponsored by the United States Senate and House of Representatives, and although the House voted to pass the "H.R. 8333 Bill", on the Senate line, there has been no movement since the Senate Homeland Security and Governmental Affairs Committee voted to pass the "S.3558 Draft" on March 6, and the Senate plenary session has not been announced or scheduled. BioCentury recently pointed out that as the United States election approaches, the Senate is likely not to schedule a vote on this bill at all.

Taking a step back, even if the Senate immediately turns its "tacit rejection" status, it will take time to schedule a vote; Even if it does, if there is a discrepancy between the text and the House version, the two parties will have to re-communicate until an agreement is reached, a process that often takes months or more. The United States election is very close to November, and the whole month of October until November 12 is the local work week related to the election, and there is usually no plenary session of the House.

The legal team of Tianmu Life Sciences pointed out that if the bill wants to be passed by separate legislation, it must complete the key links before the presidential change, but the possibility of completing it in September is almost non-existent in terms of time. Sidley, a well-known law firm, also analyzed that the "Biosecurity Act" is still only a proposal, and no matter who wins the United States election in November, the bill is likely to hang before the congressional recess at the end of the year.

Jake Auchincloss, a member of the House of Representatives, made it clear that "even if the bill passes in the Senate, there will still be a chance to revisit the issues in the session," he said, adding that it may even be necessary to press the pause button and consider the bill in the next Congress.

Taking a step back, how much impact would the bill have if it did become law? If you look closely, I'm afraid it's still much smaller than most people think. The House version of the draft Biosecurity Act was first proposed in January this year, numbered "H.R. 7085", but both macro industry statistics and the close voices of many pharmaceutical companies clearly show that the industry is worried about the passage of the bill, so the draft has been promoted with twists and turns.

In May of this year, the House of Representatives released a revised draft of the Biosecurity Act (H.R. 8333), which was significantly lighter. According to Ropes & Gray, the draft law firm narrows the definition of "contract" to "Federal Acquisition Contract" (FAR), removing restrictions on United States health care-related contracts such as Medicare and Medicaide — meaning that the scope of affected cooperation is significantly narrower. BioCentury interviewed lawyers who specialize in "United States Government Contracts" and came to a similar conclusion.

In addition, due to strong concerns from industry insiders, the revised draft bill also includes a non-retroactive clause ("grandfather" clause). In BioCentury's previous survey, more than 90% of respondents expected that the draft Biosafety Act would hinder the development and manufacturing of their company's product pipeline, leading to the disruption of clinical trials, which would significantly delay the progress of drug approval. According to a survey published in May by BIO, an authoritative biotechnology organization in United States, it will take at least eight years for United States biopharmaceutical companies to find an alternative service provider for WuXi AppTec.

The new "grandfathering" clause makes a concession and allows designated companies to continue to perform contracts funded by the United States government for their clients until 2032. Even United States politicians themselves have to admit that WuXi AppTec plays an important role in the global pharmaceutical industry, and it is difficult to "decouple" and erase it in a short time.

And in the next eight years, no one can say how the external environment will change. If you want to introduce a bill before the election, politicians should theoretically work together and move quickly. However, from this separate legislative vote, it can be seen that whether it is between the Senate and the House of Representatives, or within the Republican Party and the Democratic Party, the differences are getting bigger and bigger.

When the House Oversight Committee voted on the revised draft Biosecurity Act in May, it passed with a large vote of 40-1, but in this unanimity vote, only 306 votes were cast in the House of Representatives, with a 70% support rate, which narrowly fell below the "bottom line" of more than two-thirds of the approval to pass the bill.

In terms of party splitting, 79 out of 111 Democratic votes were opposed, and senior Democratic Rep. Ji·m McGovern publicly stated on the eve of the vote that "this is a bad bill" due to the lack of transparency and improper procedures of the "named" company list; During the debate on the day of the vote, McGovern also pushed out many supporters of the bill and took a strong attitude against the bill, which won a lot of support.

In the Senate, even the Republican Party is not unanimous, and in the previous committee voting stage, Republican senators represented by Rand Paul have emerged to oppose the bill in a clear and unequivocal manner. Even if the draft bill continues to advance in the Senate, it will be more difficult to pass than the House of Representatives.

Although there are still uncertainties in the prospect of cross-border games in the biopharmaceutical industry, one thing is clear: patients are still waiting for high-quality and cost-effective new drugs, global new drug research and development cooperation has not stopped, and the industry's cooperation with WuXi AppTec, WuXi Biologics and other companies is also growing.

It's no surprise that customers trust these companies to cooperate. The industry media "Archimedes Biotech" recently wrote that WuXi AppTec adopts a unique "CRDMO" model, which is only one word different from CDMO, but it is very different, and the extra R (research) can enable WuXi AppTec to always stand at the forefront of the industry, so that the company can always keep up with scientific and technological innovation, including timely capture of new molecular opportunities, and at the same time open up the whole industry chain from top to bottom, to achieve "end-to-end" services from R (research) to D (development) and then to M (production).

In other words, this well-rounded, volume-leading company is hard to replace. If a pharmaceutical company that uses WuXi AppTec's multi-link services wants to replace the service provider, it means that they need to find multiple service providers to fill the gap in capacity scale, which will increase the risk of project convergence, slow down the speed of progress, and raise the cost of new drug development and production, which will eventually be passed on to patients.

As early as March and April this year, many mainstream media and industry authoritative media issued concerns and warnings one after another, believing that stopping cooperation with the companies mentioned in the proposed bill would obviously harm the interests of patients. The New York Times article notes that WuXi AppTec has a significant presence in the United States pharmaceutical industry, producing some or all of the main ingredients for multibillion-dollar therapies that are widely used to treat cancers such as leukemia and lymphoma, as well as obesity and HIV infection.

The report by GlobalData, a well-known consulting firm, gives specific examples: "Several biopharmaceutical companies, including Merck, Gilead Sciences, and Vertex Pharmaceuticals, have shown that the Biosafety Act could have an impact on them in terms of increased costs, slowed clinical trials, FDA filings, and product launches." The report reads.

Endpoints News, C&EN and other industry media have also reported on the concerns of United States customers about the loss of WuXi.

Harvey Berger, CEO of Boston-based Kojin Therapeutics, said Kojin's drug development budget would quadruple if the company had to work with local service providers in the United States; Jonathan Kil, CEO and chief scientific officer of Sound Pharmaceuticals, said that they had asked European CDMOs if they had the capacity to produce commercial-stage drugs, and that the companies said they would have to outsource again, and that WuXi AppTec was able to deliver large quantities of drugs very quickly, "and if someone limited our ability to work with WuXi AppTec, the consequences would be dire." ”

Even though the House of Representatives vote is on the line, there are still pharmaceutical companies that firmly support WuXi AppTec. In the August issue of the Boston Business Journal, PepGen CEO James McArthur noted that he has used the company's services in three or four companies he has worked for in the past, "and they've always done a great job." In the case of his previous company, no United States manufacturer could do the job they wanted in a limited timeframe, and WuXi AppTec "used creative solutions to deliver fairly solid results." The article pointed out that the passage of the Biosecurity Act, if passed, could harm the biomedical industry in Massachusetts, where it is located, and ultimately affect patients.

Politicians may care about stance and posture, but real practitioners pay more attention to the quality, cost, speed and results of advancing new drug development to marketing and commercial production. The discerning person should judge which group of people is more likely to indicate whether the proposed bill mentions companies that are beneficial or harmful to the development of the pharmaceutical ecosystem in United States and even the world.

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