The Trump administration is forcing Chinese firm iCarbonX to divest its majority stake in U.S.-owned health startup PatientsLikeMe, CNBC reports.
The forced sale comes after a review of the deal by the Committee on Foreign Investment in the United States, a group that reviews and enables the federal government to block foreign takeovers of American companies and foreign investments.
This is the first time the Committee on Foreign Investment has homed in on such a small deal, according to CNBC. The committee likely targeted the company due to the sensitive nature of the data it collects on its users. Some in the startup world, however, are concerned the move could stunt future capital. Chinese investments in the U.S. have declined from $46 billion in 2016 to $4.8 billion in 2018, according to the report.
Cambridge, Mass.-based PatientsLikeMe is an online tool that allows patients to connect with other people who have similar medical conditions. It raised $100 million when it sold a majority stake to iCarbonX in 2017. The Chinese firm has also been able to offer the startup key artificial intelligence technology.
PatientsLikeMe is still seeking a buyer and has been in talks with a few U.S.-based companies, according to the report.
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