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Staff at drugmaker under U.S. scrutiny worked with Chinese military scientists

[June 06, 2024] By Kirsty Needham and Andrew Silver

SYDNEY/SHANGHAI (Reuters) - Employees of drugmaker WuXi AppTec, under U.S. scrutiny for its links to the Chinese military, co-invented altitude sickness treatments with People's Liberation Army (PLA) scientists, according to public patent records and science papers reviewed by Reuters.

The news agency identified 10 patent filings that list six of WuXi AppTec's staff as co-inventors of altitude sickness drugs with six scientists from the PLA General Hospital in Beijing - China's top military medical school and research centre. The filings, which Reuters is reporting for the first time, were made in the U.S., Europe and China between 2018 and 2023.

Treatments for such illnesses are a top priority for the PLA, which fought with India - an increasingly important U.S. security partner - as recently as 2022 on their Himalayan frontier. The PLA has said high altitude disease, which include disorientation as well as fatal pulmonary and cerebral edema, is the major cause of reduced combat effectiveness to Chinese soldiers in such areas and can influence the results of war.

The drug development ties go beyond the links between WuXi AppTec and the PLA that have been publicly alleged by a U.S. congressional committee.

The House Select Committee on the Chinese Communist Party has accused the Shanghai-headquartered company, which reported U.S. sales of about $3.6 billion last year, of being a threat to Washington's national security interests.

WuXi AppTec, which denies allegations that it is a threat to U.S. national security, said in a statement to Reuters that it "did not collaborate with PLA General Hospital or any other PLA-related entity in the performance of this work" and that it has "no special ties" to China's military.

It said its employees were listed in the patent documents because they had earlier "invented compounds related to hypertension treatment" while doing research for a client, Shijiazhuang Sagacity New Drug Development.

Sagacity included the compounds "in a subsequent project that we had no knowledge of and did not involve our company or employees," WuXi AppTec said.

Sagacity, whose founder was the legal representative of a company acquired by WuXi AppTec's parent in 2016, told Reuters it is independent of WuXi AppTec but cooperates with it on certain services. It did not respond to questions about the patent's inventors.

China's defense ministry did not respond to a request for comment on the PLA's relationship with WuXi AppTec.

PLA General Hospital senior official Kunlun He, lead author of the studies behind the patented treatments and a co-inventor, did not return an email seeking comment.

PATENT TRAIL

Reuters found two U.S. Patent and Trademark Office documents dated March 2021 that show the six WuXi AppTec employees signed over rights to the patents to Sagacity and PLA General Hospital.

Asked about the documents, WuXi AppTec said that it was "standard patent application practice" to sign over the rights to the applicants and that neither the company nor the six employees owned those patents.

In a June 2022 study related to altitude sickness treatments, He, the scientist who led PLA General Hospital's altitude research efforts, thanked WuXi AppTec's team for “helpful discussions regarding initiating and promoting" a Beijing-funded high-level defense science project.

U.S. Republican lawmaker John Moolenaar, who chairs the congressional committee, said that Reuters' findings "only adds to the urgent need for Congress" to pass proposed legislation that would restrict U.S. agencies and firms from cooperating with some biotech companies, including WuXi AppTec.

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The logo of Chinese drug research and development group WuXi AppTec is displayed alongside an open letter addressing a U.S. legislative initiative on its company website, in this illustration picture taken February 5, 2024. REUTERS/Florence Lo/Illustration/File Photo

"People forget that public health really for the most part has been run by the PLA," said Anna Puglisi, a former U.S. counterintelligence officer focused on biotechnology and China, who reviewed Reuters' findings.

China's foreign ministry said in a statement responding to Reuters' questions that many well-known U.S. companies also have ties with the U.S. military.

It said that Washington should "stop overstretching the concept of national security" and "stop politicizing, instrumentalizing and weaponizing tech and trade issues".

MILITARY RESEARCHERS

Reuters also identified seven people listed in research documents or science seminar documents as graduate students or researchers at Shanghai's Navy Medical University while they were WuXi AppTec employees.

Sheng Chunquan, a four-star military officer who heads the university's pharmacy school, wrote in a 2021 article in China's Journal of Pharmaceutical Practice and Service that it trained "military pharmacy" researchers under a plan created by the Communist Party's top military decision-making body.

Sheng, whose drug development work was previously recognized with a WuXi AppTec prize, said in a 2016 interview - recently deleted from the company's social media account - that cooperation between the firm and the university would "greatly promote the process of new drug R&D and launches."

University officials did not respond to emails and a fax seeking comment.

A Reuters review of over a dozen science papers found that at least three Navy Medical University graduate students hired by WuXi AppTec in Shanghai during the same period also worked on projects related to pain treatments and an antibiotic for WuXi AppTec clients from the U.S., Europe and Canada, including Novartis.

A Novartis spokeswoman told Reuters the Swiss company would not disclose details of its collaboration with third parties but that it is "committed to conducting our business in a fully compliant manner."

WuXi AppTec said all military medical universities in China enrol civilian students. It also said its internal security controls prevent access by unauthorized employees to labs and files and that all employees signed agreements that "prohibit them from sharing company data or intellectual property with third parties, including for the purpose of academic research and/or graduate studies."

Puglisi, now adjunct faculty at Georgetown University, said Chinese companies were obliged by a 2017 law - which states they must "assist and cooperate with the state intelligence work" - to share information upon the request of authorities "regardless of who owns that IP."

WuXi AppTec said the law was "subject to substantive and procedural restrictions" and Beijing has not asked it to "provide proprietary data or confidential information in connection with this law."

($1 = 7.2330 Chinese yuan)

(Reporting by Kirsty Needham, Andrew Silver and Michael Martina; Editing by Miyoung Kim and Katerina Ang)

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