The U.S. House of Representatives Committee on China has formally requested a briefing from the FBI and the intelligence community regarding GenScript Biotechnology Co and its three subsidiaries to assess potential healthcare espionage by the Chinese Communist Party (CCP) over their operations. This move reflects growing concerns about national security and the protection of U.S. intellectual property.
What is Genscript?
GenScript is a biotechnology company that provides a wide range of services in the pharmaceutical and life sciences sectors. It specializes in custom gene synthesis, peptide synthesis, protein engineering, and antibody development. Additionally, GenScript offers contract research and manufacturing services to support drug discovery and development processes. It is listed on the Hong Kong Stock Exchange.
What is Healthcare Espionage?
Healthcare espionage refers to the act of spying or covertly gathering intelligence related to healthcare practices, technologies, research, or information. This can include efforts to steal intellectual property, research data, or sensitive information from healthcare institutions, companies, or organizations.
The goal of healthcare espionage can vary but often involves gaining a competitive advantage, advancing one’s healthcare capabilities, or accessing valuable medical information for illicit purposes.
Concerns Over Intellectual Property and Biotech Capabilities
In a letter dated May 30, committee chair John Moolenaar and ranking member Raja Krishnamoorthi expressed their worries about GenScript’s collaborations with U.S. companies and the government.
GenScript Biotechnology Co and its three subsidiaries have attracted the attention of the U.S. House of Representatives Committee on China due to concerns regarding the potential influence of the Chinese Communist Party (CCP) over their operations.
The committee has requested a briefing to investigate GenScript’s collaborations with U.S. companies and the government, citing worries about intellectual property risks and the potential enhancement of China’s biotech capabilities through these partnerships.
Focus on GenScript and Its Subsidiaries
The committee’s scrutiny extends to three subsidiaries of GenScript: Bestzyme, Legend Biotech, and ProBio. Of particular interest is Legend Biotech’s partnership with Johnson & Johnson, which developed the cancer cell therapy Carvykti.
The drug’s success, with $500 million in sales last year and projections to exceed $5 billion annually, has raised eyebrows about the potential misuse of U.S. intellectual property.
Among these, Legend Biotech has gained significant attention due to its partnership with Johnson & Johnson in 2017 to develop the cancer cell therapy Carvykti. The drug generated $500 million in sales last year, with future annual sales expected to exceed $5 billion.
GenScript’s Response and Corporate Footprint
A spokesperson for GenScript emphasized that the company was founded in New Jersey and operates independently of any government directives. They also expressed their willingness to cooperate with the House committee. Legend Biotech, Johnson & Johnson, and the other subsidiaries did not immediately respond to requests for comments.
GenScript operates as a pharmaceutical research and manufacturing service provider, boasting over 200,000 customers across more than 100 countries. The company has sales, manufacturing, and research and development facilities in China, the U.S., Europe, and the Asia Pacific, highlighting its extensive global presence.
Legislative Context and Broader Implications
The committee’s scrutiny of GenScript occurred shortly after another House committee approved a bill to limit business with several Chinese biotech firms, including WuXi AppTec, WuXi Biologics, BGI, MGI, and Complete Genomics. This proposed legislation aims to reduce U.S. dependence on Chinese research to address healthcare espionage and manufacturing in the pharmaceutical and healthcare sectors.
The bill still needs approval from the full House and Senate before it can be signed into law by President Joe Biden. If enacted, it would significantly impact U.S. pharmaceutical companies, urging them to diversify their supply chains and research collaborations away from China.
Looking Ahead
It has become essential for US Pharma companies to stay away from Chinese Healthcare Companies in the wake of potential healthcare espionage.
The committee’s letter underscored the importance of GenScript’s role as a Contract Development and Manufacturing Organization (CDMO), which includes services like custom gene synthesis for both companies and U.S. government entities. The potential risks to U.S. intellectual property and the possibility of advancing China’s biotech capabilities remain critical concerns for lawmakers.
As the investigation unfolds, the possible healthcare espionage could shape future regulatory and business strategies for U.S. firms involved in biotech collaborations, ensuring national security and intellectual property protection remain paramount.
