National Security Concerns over BGI Bid for Complete Genomics

BGI-Shenzhen's proposed $117.6 million purchase of Complete Genomics is raising concerns about national security, Politico reports.

BGI made its bid in September and is currently awaiting approval from the US Federal Trade Commission. In the meantime, however, the sale is also under review by the Committee on Foreign Investment in the United States, or CFIUS, and Politico says that one issue being raised by the idea of a sale of Complete Genomics to BGI is "whether there are national security concerns attached to allowing a company largely funded by the Chinese government to have access to human DNA being decoded for doctors, researchers, and pharmaceutical companies."

The article also quotes Michael Wessel, a commissioner on the United States-China economic and Security Review Commission, a congressionally appointed advisory panel: "Because there are questions about the technologies that are involved that are complex, cutting edge, and have national security implications related to bioweapons, this bears strict scrutiny. Are there capabilities here that can be adverse to American interests?"

As our sister publication, GenomeWeb Daily News reported recently, Illumina has made an unsolicited offer for Complete Genomics by increasing its bid about 5 percent over BGI's offer, and in a letter to the Mountain View, Calif.-based firm, Illumina President and CEO Jay Flatley raised the specter that a BGI-Complete Genomics merger could be nixed by CFIUS.

Politico points out that other proposed acquisitions of American firms by Chinese buyers have either been abandoned when it became clear that CFIUS would not allow the deal to proceed, or have been blocked by the White House altogether. It notes also that with the rise of China as a global economic power, any deal with Chinese firms involving "sensitive industries" will be put under the microscope for security issues.

BGI refutes any claims that its buy of Complete Genomics raises national security questions, saying the company is privately owned and not a state-owned enterprise and that Illumina is a supplier to BGI.

"Only now, when BGI proposes simply to broaden its sequencing platform offerings, does Illumina claim that BGI's supply of services in the United States raises any regulatory concerns," BGI COO Ye Yin said in a letter to Complete Genomics CEO Cliff Reid.

George Church echoes that sentiment, telling Politico that the national security issue is a "red herring." Technology is already being used to prevent the dissemination of genetic data, and "if you're a clinic that's totally up to date and clued in and paranoid, you're going to demand proof of security and bring in a third party to make sure that data not only doesn't go to the Chinese government, but to anyone outside your clinic."