March 13 (Reuters) - A Washington-based global trade

association representing biotechnology companies is taking steps

to "separate" from Chinese member Wuxi AppTec

, according to a letter from its new CEO on Wednesday.

The Biotechnology Innovation Organization (BIO) also said it

would support proposed legislation that restricts U.S. business

with WuXi AppTec and other biotech companies of concern,

changing its position from last month.

WuXi AppTec, in a letter to BIO dated Tuesday that it

provided to Reuters, said it was ending its membership in the

organization.

Shares in Wuxi AppTec in Hong Kong dropped 7.7% on Thursday,

while its Shanghai shares fell 4.6%.

A U.S. Senate committee voted to approve a bill last week

that could prohibit federal agencies from contracting with Wuxi

AppTec and other Chinese biotech companies on national security

grounds. A companion bill was introduced in the House in

January.

The bill is designed to keep Americans' personal health

and genetic information away from foreign adversaries. It drove

a sell-off in the shares of WuXi AppTec after news about it

reached Chinese markets last month.

BIO has an "unwavering commitment to the national security

of the United States and our allies," John Crowley, who became

BIO's CEO and president last week, said in the letter to

Representative Michael Gallagher, chair of the select committee

on China in the U.S. House of Representatives.

"BIO will support the BIOSECURE Act and work with you

and other members of Congress as this legislation progresses,"

Crowley wrote. "BIO is taking steps now to separate from Wuxi

AppTec regarding membership in the organization."

Last month, then BIO CEO Rachel King wrote a letter urging

the committee to reconsider the proposed legislation, and took

issue with companies being named in it.

WuXi AppTec has said the bill "relies on misleading

allegations and inaccurate assertions."