Sens. Warren, Rubio push legislation for federal study on pharmaceutical supply chain’s overreliance on foreign interests

Alarmed by heavy U.S. reliance on foreign nations for both its supply of drugs and pharmaceutical products, U.S. Sens. Elizabeth Warren (D-MA) and Marco Rubio (R-FL) introduced a bill this week to require a study of that overreliance.

Specifically, the bill would require the Federal Trade Commission (FTC) and the Secretary of the Treasury to conduct a study on overreliance both on foreign countries and foreign direct investment in the pharmaceutical industry. Such connections and limitations have come under increased scrutiny this year as a direct result of the COVID-19 pandemic, which has at times strained the U.S. supply chain to the breaking point.

It is estimated that nearly 80 percent of the active pharmaceutical ingredients — a necessary component of generic drugs — are imported. While in the past, this has made for an efficient system, it has not made for a robust one, and the senators argued that it is a system vulnerable to disruption, intentional or otherwise.

“To defeat the current COVID-19 crisis and better equip the United States against future pandemics, we must take control of our supply chain and rely less on foreign countries for our critical drugs,” Warren said. “Our bill will require a study to show the effects of this overreliance and identify the tools we need to confront it head-on.”

Within one year of the bill’s passage, the FTC and Treasury would be required to report on the impacts of foreign overreliance, impacts of foreign direct investment on drug and drug component production, the impacts of drug investment in U.S. genome sequencing technologies affecting domestic capacity to sequence or store DNA and the number of foreign investments in the pharmaceutical industry and sequencing/storage of DNA the Committee on Foreign Investment in the United States has noted in the last decade.

“More than a year ago, I warned that our nation has critical vulnerabilities and supply chain risks in key sectors of our economy, including in pharmaceuticals, as a result of decades of lost industrial capacity to China,” Rubio said. He and Warren submitted additional legislation in March to counter supply chain risk. “The coronavirus pandemic has made it painfully clear that we must take decisive action to rebuild our nation’s medical manufacturing sector. This bipartisan bill would ensure policymakers have the necessary information to address our supply chain vulnerabilities, the consequences of foreign investment in U.S. pharmaceuticals, and reduce our overreliance on China for pharmaceuticals.”