Congress Wants to Know Why Merck and AbbVie Ran Drug Trials at Chinese Military Hospitals

Second, ethics in Xinjiang. In a region where the government has been accused of mass detention and forced labor, can you really guarantee that trial participants gave informed consent? That nobody was coerced? The committee seems skeptical that even "the most robust due diligence" can eliminate those risks.

Not Just Merck and AbbVie

Days after the initial letters went out, the committee sent similar requests to Eli Lilly, Pfizer, and Bristol Myers Squibb. This isn't a targeted hit on two companies. It's an industry-wide reckoning.

And the scope is broad. For Merck, the committee flagged trials covering rheumatoid arthritis, Crohn's disease, ulcerative colitis, prostate cancer, and bacterial pneumonia. For AbbVie, the scrutinized programs span several cancers, dermatitis, migraines, and lupus. One committee communication even name-checked Merck as the "Keytruda maker," strongly implying that oncology trials involving its blockbuster immunotherapy are part of the inquiry.

Why China Became Big Pharma's Go-To Lab

To understand why so many trials ended up in China, follow the economics. China is, by most accounts, the cheapest and fastest place on earth to run early-stage human drug trials. Regulatory reforms over the past decade made it easier. State subsidies helped. Patient recruitment runs two to three times faster than in other countries.

AbbVie's own data tells the story: China now participates in 85% of AbbVie's global Phase III trials. That's not a side operation. That's the backbone of late-stage drug development.

Both companies have also been striking massive deals with Chinese biotechs. AbbVie signed nearly $10 billion in R&D collaboration agreements with Chinese firms from mid-2024 to early 2026. Merck inked deals with Hansoh Pharma and Jiangsu Hengrui worth up to $2 billion each. These partnerships typically include clinical trials run at Chinese sites, with data flowing into global regulatory filings.

The Bigger Game: Biotech as the New Semiconductor

This investigation doesn't exist in a vacuum. Congress increasingly treats biotechnology the way it treats chips and AI: as a strategic asset in the competition with China.

Chairman Moolenaar is simultaneously pushing the Biotechnology Investment National Security Act, which would subject biotech licenses and joint ventures in China to security reviews (similar to the CFIUS process that already screens foreign investments in sensitive sectors). The BIOSECURE Act, signed into law in late 2025 as part of the defense spending bill, already bans federal contracts with certain Chinese biotech companies.

And the FDA itself has started drawing lines. The agency recently halted new clinical trials that involve shipping American patients' living cells to China for genetic engineering. Separately, non-binding House committee report language would recommend that the FDA not accept clinical data generated at sites in China, Russia, Iran, or North Korea for IND applications. That language hasn't become law, but the message is clear.

What Happens Next

The July 17 deadline looms. Merck has said patient safety and ethical integrity are priorities. AbbVie has emphasized compliance. Both will submit detailed responses, and how they describe their data protection and site oversight could shape the narrative for months.

Analysts see the investigation as a "policy overhang" rather than an immediate business threat. Share prices dipped modestly on the news; nobody expects trials to be shut down overnight. The real risk is longer-term: if Congress restricts the use of China-generated data for U.S. drug approvals, the entire industry's development playbook gets rewritten.

Companies are already hedging. Expect a quiet but significant shift away from PLA-affiliated hospitals and Xinjiang trial sites. Expect stronger data-segmentation protocols and beefed-up governance frameworks. Expect the phrase "geopolitical risk" to start showing up in clinical development plans right alongside patient enrollment projections.

For two decades, running drug trials in China was a no-brainer: fast, cheap, effective. Now it comes with a question that no amount of due diligence can fully answer. Congress is asking that question out loud, and the entire pharmaceutical industry is listening.

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