U.S. Sanctions Chinese Chemical Firm for Fueling America’s Synthetic Opioid Crisis

September 3, 2025 | Washington, D.C. — The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on Guangzhou Tengyue Chemical Co., Ltd., a China-based company accused of manufacturing and exporting synthetic opioids and chemical cutting agents to the United States.

Alongside the company, OFAC also designated Huang Xiaojun and Huang Zhanpeng, two senior representatives linked to Tengyue’s global trafficking operations. Both men allegedly coordinated shipments of opioids and adulterants to U.S. buyers, helping sustain the international pipeline that has devastated American communities.

“A Direct Threat to American Families”

“Illicit opioids coming from China are destroying American lives, families, and communities,” said Under Secretary for Terrorism and Financial Intelligence John K. Hurley. “Under President Trump’s leadership, we are deploying every tool available—including sanctions and prosecutions—to stop this epidemic.”

Opioid overdoses remain the leading cause of death for Americans aged 18 to 45. Since 2021, over 70% of drug-related deaths have involved synthetic opioids, particularly FYL. China continues to be the primary supplier of FYL precursor chemicals and related synthetic opioids entering the U.S.

The OFAC investigation was carried out in collaboration with the Drug Enforcement Administration (DEA), the Federal Bureau of Investigation (FBI), and other law enforcement partners.

Federal Indictments Announced

Alongside the sanctions, the FBI unsealed a federal indictment charging Guangzhou Tengyue, Huang Xiaojun, Huang Zhanpeng, and nearly two dozen co-conspirators for violating Title 21 U.S. Code 846 (Conspiracy to Commit Drug Trafficking).

The case stems from a joint FBI–DEA investigation launched in January 2024, which uncovered a trafficking network responsible for importing multi-kilogram quantities of FYL, FYL-adulterants, methamphetamine, and cocaine into the United States. Investigators found that U.S.-based collaborators ordered chemical products from China to increase drug yields, including nitazenes, XYL, and medetomidine, as well as pill presses for repackaging.

“Tranq” and Nitazenes: A Growing Threat

The investigation highlights the rise of nitazenes, a class of synthetic opioids with potency comparable to or greater than FYL. According to the DEA, nitazenes have a high risk of addiction and fatal respiratory depression.

Equally alarming is the widespread use of XYL, also known as “tranq,” an animal tranquilizer increasingly mixed into opioids. XYL does not respond to overdose-reversal medications like Naloxone, significantly raising the likelihood of fatal overdoses.

Reports from the National Institute on Drug Abuse show that XYL is becoming more common in the illicit supply, further compounding the danger of synthetic drug mixtures circulating in the U.S.

Guangzhou Tengyue: “Profits Over Lives”

Despite mounting U.S. pressure, Guangzhou Tengyue has continued to market and sell dangerous chemicals.

• In August 2023, the company agreed to sell one kilogram of protonitazene—a powerful nitazene—to a U.S. buyer, promising it would clear customs.

• As late as August 2024, Tengyue’s website openly advertised nitazenes and XYL for sale.

• Even after a federal indictment in October 2024, the company pressed ahead, coordinating shipments of medetomidine, another powerful sedative, to U.S. customers in early 2025.

Huang Zhanpeng, Tengyue’s executive director and 50% shareholder, acted as the company’s official representative, while Huang Xiaojun managed bitcoin accounts tied to international drug sales.

Sanctions and Consequences

Under Executive Order 14059, OFAC formally designated Guangzhou Tengyue, Huang Xiaojun, and Huang Zhanpeng for materially contributing to the international spread of illicit drugs.

The sanctions mean:

• All U.S.-based property and assets linked to the designated parties are frozen.

• U.S. individuals and businesses are prohibited from conducting transactions with them.

• Any entity owned 50% or more by the designated persons is automatically blocked.

• Violations of these sanctions may result in civil or criminal penalties.

Non-U.S. persons may also face penalties if they facilitate or conceal transactions with the sanctioned parties.

A Path to Enforcement—and Removal

OFAC emphasized that its sanctions are not purely punitive. The agency may remove individuals or entities from the sanctions list if they demonstrate a genuine change in conduct. Information on this process can be found in OFAC’s Frequently Asked Question 897 and through its formal request system.

A Broader Message

The action against Guangzhou Tengyue underscores a broader U.S. commitment to choke off the international supply chain of synthetic opioids like FYL and adulterants like XYL.

By combining sanctions, indictments, and international pressure, U.S. officials hope to cut off the flow of lethal chemicals before they reach American streets.

Source: U.S. Department of Treasury