China has banned the import of Illumina’s next-generation sequencing (NGS) sequencers as part of retaliatory measures against fresh tariffs imposed on the country by the Trump administration on 4 March.
China’s Ministry of Commerce (MOFCOM) announced the ban hours after the White House said it would impose an additional 10% tariff on Chinese imports into the US, bringing the total to 20% following the first 10% tariff imposed last month.
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Illumina’s NGS sequencers are used to sequence DNA or RNA samples and use a technology known as sequencing by synthesis (SBS) to enhance DNA short-read sequence generation.
According to a GlobalData market model, the top three NGS companies by global market share in 2024 were Illumina, Pacific Biosciences, and Thermo Fisher Scientific. Illumina holds a 34.5% market share in China, so tariffs will have a significant impact, according to GlobalData’s director of therapy research and analysis in medical devices Dr Andrew S Thompson.
However, Selena Yu, senior medical analyst at GlobalData, notes that it is sequencers that are banned and not consumables.
“Typically, sequencers are not sold and bought frequently compared to the actual tests,” said Yu.
“Most of Illumina’s revenue in 2024 was in consumable sales (72%) compared to instrument sales (12%). $438m was in Greater China (China, Taiwan, and Hong Kong) out of $4.37bn of revenue.”
The Chinese market contributed to around 7% of Illumina’s 2024 revenues at $300m, although China-associated revenues for the company have fallen in consecutive years, with declines of 20%, 18% and 6% in 2024, 2023, and 2022 respectively.
Yu concluded: “Existing Illumina sequencers in China can continue to be used because consumables are still being sold…this ban on the instruments just pushes this downward motion of Illumina in the Chinese market.”
Illumina told Reuters it would continue to serve its customers in China, and that it was “committed to operating in compliance with the latest guidelines from the Ministry of Commerce”. The company also told the news agency it was assessing MOFCOM’s announcement in detail to more fully understand the impact it would have on its China operations.
Following MOFCOM’s announcement, Illumina’s stock price fell around 4% in overnight trading, yet recovered this morning to a loss of around 1.5% from 4 March.
The import ban on Illumina’s sequencers follows the San Diego biotech’s placement on the MOFCOM’s ‘Unreliable Entity List’ on 4 February in response to the initial 10% tariffs imposed on China.
In Illumina’s case, MOFCOM stated that its induction onto the list, which currently includes more than 20 companies, including Calvin Klein’s parent company PHV, may open it up to sanctions, including the “prohibition on exporting gene sequencing instruments to China”.
According to MOFCOM, the companies on the list have been placed there to “safeguard national sovereignty, security, and development interests, based on the “Foreign Trade Law of the People’s Republic of China”, the “National Security Law of the People’s Republic of China”, the “Anti-Foreign Sanctions Law of the People’s Republic of China”.
