WASHINGTON — Chinese investors have been pouring money into U.S. biotech companies. That’s why the Trump administration’s new rules issued last month putting certain foreign investments under greater scrutiny came as a worrisome development for many in the industry.
The new rules are complicated, and there’s a lot of uncertainty about how they’ll be enforced — as well as, crucially, whether they’ll slow the flow of capital from China into the U.S. biotech sector. We called up lawyers to help map out what you need to know before the first stage of the regulation goes into effect next week.
What’s changing, exactly?
The policy change expands the power of the Committee on Foreign Investment in the U.S. CFIUS, as the federal interagency group is known, can review foreign investments for whether they put national security at risk. CFIUS can block deals deemed to pose a threat, and can even force companies to undo investments after the fact.
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