Loading ASIO chief Mike Burgess issued a statement on Sunday night saying his organisation "takes seriously" and was actively investigating Mr Zhao's allegations. Mr Chen has denied knowing Mr Zhao or being involved in Chinese intelligence activities, but sources say Australian authorities have determined that Mr Chen had been in contact with Mr Zhao. Mr Chen and Prospect Time approached startup Imunexus in June 2017 after the company took second place in a biotechnology competition in Shenzhen, China. The company is researching and developing antibodies. Mr Kopsidas, the startup's founder, said Mr Chen offered almost $10 million to buy a majority stake in the company, and claimed he had "hundreds of millions" in financial backing to turn Imunexus' antibody technology into a saleable product. "What Brian wanted to do was to start a full-on biotech company in Australia, a pharmaceutical company," said Mr Kopsidas. "He wanted to develop products and take them into manufacturing and marketing and sales."

Imunexus' laboratory and office is located in a CSIRO building in Melbourne's biotech hub of Parkville, and Mr Kopsidas said Mr Chen was particularly interested in acquiring office space in the CSIRO facility. "He wanted to lease out an entire wing … he was talking about a significant proportion of the building," said Mr Kopsidas. Loading Replay Replay video Play video Play video Australian Strategic Policy Institute analyst Alex Joske raised security concerns about the CSIRO sharing its premises with foreign-owned companies. “It’s much easier to conduct scoping work from inside the building ... where you can enter sections of the CSIRO facility without authorisation," Mr Joske said. Rory Medcalf, head of the Australian National University’s National Security College, said the proposed deal "certainly raises a lot of questions”.

Mr Chen told Mr Kopsidas his background was in aviation and real estate when they met twice at Mr Chen’s office in 101 Collins Street. Mr Kopsidas said Mr Chen had poor English skills and spoke through two translators. Negotiations eventually broke down after Imunexus were not satisfied with the terms of the proposed deal. "The deal was very much skewed in Brian's favour," said Mr Kopsidas. "In the end, he just wandered off and we never heard back from him … it was really unusual to us." A CSIRO spokesman said the organisation was unaware of Mr Chen's approach to Imunexus, and said it had mechanisms in place to guard against potential threats from foreign-owned organisations. "CSIRO undertakes a legal entity check of any third party entities and performs internal approvals for any proposed occupancies to ensure that the tenancies align with CSIRO’s operations," said the spokesman. In recent years, the CSIRO has spent tens of millions of dollars upgrading its cyber security systems following a 2013 data breach linked to a Chinese national.