Chinese biotech giant Wuxi AppTec sees first-half earnings surge amid US scrutiny

Wuxi AppTec, a leading biotech company, reported a significant surge in first-half earnings, exceeding market forecasts. The net profit attributable to owners skyrocketed 33.7% to 11.08 billion yuan, surpassing the Bloomberg consensus estimate of a 14.5% increase. CEO Li Ge attributed the growth to robust performance across various client drug programs, highlighting strong commercial momentum.

The company's Hong Kong-listed shares rose by 1.37% to HK$162.90, marking a 62% year-to-date increase. Revenue reached 28.9 billion yuan, a 38.9% rise year-on-year, with 77% of the total revenue coming from the US market. The US segment saw revenues of 22.28 billion yuan, compared to 14.24 billion yuan in the same period last year.

Wuxi AppTec's GLP-1 peptides business, known as the "tides" business, showed impressive growth, up 44.3% to 7.26 billion yuan, with a projected 45% increase for the year. However, the company has faced scrutiny from the US government, being placed on the 2026 Section 1260H list, potentially affecting its eligibility for US government contracts.

The company has challenged this designation in court, asserting the listing lacks factual and legal basis. This incident is part of a larger US crackdown on China's biotech sector, with recent investigations into major American drug makers over clinical trials conducted in China.