New Delhi,jun 11
Indian contract research, development and manufacturing organisations (CRDMOs) could gain about USD 700 million in annual revenue from the ongoing China+1 supply-chain shift, with the US BIOSECURE Act emerging as a key catalyst, according to a Jefferies report.”We believe China+1 is a ~USD700m/yr incremental revenue opportunity for Indian CRDMO firms”, the report noted.The brokerage said the opportunity has intensified after Chinese pharmaceutical services company WuXi AppTec was added to the US Department of Defence’s Section 1260H list, which can trigger BIOSECURE-related restrictions on federal contracting.”WuXi AppTec’s addition to US DoD’s 1260H list triggers Biosecure restriction, which includes a ban on new US federal contracts,” Jefferies said. It added that although implementation could take “12-24 months (JEFe)”, the development “creates a massive opportunity for Indian CRDMOs.”Jefferies estimates that Indian CRDMOs collectively generated roughly USD 3-3.5 billion in FY26 sales, compared with WuXi AppTec’s USD 6.3 billion in CY25, indicating substantial headroom for market-share gains.
The report explained that the BIOSECURE Act, enacted as part of the FY2026 National Defense Authorization Act, permanently restricts federal agencies from procuring biotechnology equipment or services from designated “biotechnology companies of concern” and also prevents businesses, universities and institutions from using federal grants, loans or contract funds to work with those entities.”The earliest binding contracting restrictions will legally materialize between late 2027 and 2028,” Jefferies said, pointing to the statute’s phased implementation process involving the Office of Management and Budget and the Federal Acquisition Regulatory Council.On the industry impact, Jefferies said the shift should disproportionately benefit Indian companies with strong small-molecule and peptide capabilities.”
