Tue. Mar 31st, 2020

Senators Propose Bill To Bring Drug Manufacturing Back To U.S.

(ConservativePeak.Com)- As of today, China produces many of the world’s APIs — better known as the active ingredients that are in most of our commonly-used drugs. Republican Senator Tom Cotton is one person who hopes to change that.

On Thursday, the senator from Arkansas introduced legislation that would bring manufacturing of much of these APIs to the United States as a way to reduce the country’s dependence on China for these critical drugs.

Cotton’s recent proposal was introduced along with Mike Gallagher, a representative from Wisconsin. It is the latest effort to bring pharmaceutical supply chains back to the United States, following a similar one from Republican Senator Marco Rubio from Florida.

As a result of the coronavirus pandemic, many people here are realizing that the cost savings that can be achieved by moving manufacturing of these APIs to China may not be worth the trade-off that comes in the form of dependency on that country during a crisis. As Cotton told Fox News this week:

“China unleashed this plague on the world, and China has to be held accountable. It’s too grave a threat to let our health rest on Chinese drugs.”

The bill Cotton proposed would require the U.S. Food and Drug Administration to track the origination point of APIs and other drugs made outside the United States’ borders. It would also require drug companies to list the origination country for all their APIs on their products.

Further, it would prohibit every federal entity from buying drugs that include APIs that were manufactured in China. This includes the Veterans affairs, Defense Department and the Departments of Health and Human Services.

The other side of the bill would address pharmaceutical manufacturing here in the United States. If passed, the bill would enable manufacturers in the U.S. to expense the costs of beefing up their production capacity, which would give them a large write-off on their taxes.

This is being done as a way to incentivize these businesses to produce the APIs here, and allow them to compete with the Chinese companies, which often are able to provide them at a much lower cost.

Currently, America produces roughly 28% of the APIs that are used here, and we only import about 13% directly from the Chinese. The problem, though, is that many other companies in Europe and India that finish drugs use APIs that are produced in China. That’s what has led to 40% of the worldwide supply of APIs coming from China.

This has become very big business for China, too. Between 2010 and 2019, the number of Chinese factories that produce APIs doubled. Pharmaceutical imports in the U.S. have increased dramatically in recent years, too. According to data from the Census Bureau, in fact, they have grown by nearly 800% — from $179 million total back in 2000 to $1.56 billion last year.

This is a major reason why Cotton and others have pushed hard to bring back that production of APIs to the U.S., so that we can have total control of the drugs we need at all times.

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