By Dr. Brian Blodgett
Faculty Member, Homeland Security, American Military University
With the COVID-19 pandemic came a concern about an over-reliance on China for pharmaceuticals. While the findings were that as a nation, we did not have to worry about a critical shortage due to closings of foreign pharmaceutical plants, the simple fact remained that we relied on a foreign supply of drugs.
Until around 2000, the American derivative phenol, a byproduct of petroleum processing, provided the world with acetaminophen. Today, largely because of cost savings, China makes about 70% of what we use in the United States. Our dependence on China for acetaminophen is only a start.
Active Pharmaceutical Ingredients
The United States has 28% of the world’s active pharmaceutical ingredients (API) manufacturing facilities, yet our dependence on China and India is significant. In a May 2020 article in a Council on Foreign Relations publication, Yanzhong Huang claimed that the United States relied on China and India for around 80% of the basic APIs in our drugs.
However, since the federal government does not require pharmaceutical companies to list where the active components come from, our exact dependence is unknown. Haung also believes that about 90% of our generic drugs come from those two countries.
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In February, the U.S. Food and Drug Administration (FDA) was already examining the potential of COVID-19 affecting the pharmaceutical supply chain. One manufacturer expressed concern about a drug’s availability (the FDA did not state which drug) because the manufacturer notified the FDA that the “shortage is related to a site affected by coronavirus.”
As part of its due diligence, the FDA reminded more than 180 pharmaceuticals manufacturers of their legal requirement to notify the agency of any anticipated supply disruptions. As a part of its efforts at that time, the FDA identified at least 20 drugs that relied completely on China for their APIs or finished products. While none of these drugs was critical, it offers a brief glimpse of how China is controlling part of the market.
According to Huang, Chinese pharmaceuticals control at least 97% of the U.S. antibiotic market. In 2018, the U.S. imported more than 95% of our ibuprofen, 91% of our hydrocortisone and 40% to 45% of the heparin. High blood pressure medicines are also predominantly produced in China.
With China controlling a significant portion of the APIs for American pharmaceuticals, an alternative source could be other countries. However, according to Britain’s Medicine and Healthcare Products Regulatory Agency, China makes nearly half of the planet’s APIs.
Americans are reliant on generic drugs; about 90% of prescriptions filled by generics and approximately one in every three generics was produced in India. India faces its own problems. Writing in Medical Express, Rory Homer says India’s pharmaceuticals are also reliant on China, which produces nearly 70% of the subcontinent’s needed APIs.
As far as some medicines are concerned, such as acetaminophen, amoxicillin, and ibuprofen, India is almost 100% dependent on China. India is also very dependent on China for raw materials and chemical intermediates that they use to make the APIs.
When India initially faced COVID-19, the nation’s active pharmaceutical ingredient factories shuttered their doors. That left many manufacturers empty-handed because stockpiling APIs is relatively uncommon, with many factories having less than three months’ supply.
Rosemary Gibson, a senior fellow at the Hastings Center, a nonpartisan bioethics research center, is also concerned about our reliance on China, so much so that in 2018 she authored, ChinaRx: Exposing the Risks of America’s Dependence on China for Medicine. According to Gibson, if China were to stop providing medicines to the United States, the U.S. would run out within months, including the military which also relies on China for its medicines. That would affect both military readiness and national security.
With India being extremely reliant on China for its APIs, Dinesh Dua, the chairman of Pharmaceuticals Export Promotion Council of India (Pharmexcil), stated that “If we start now, it will take us at least 10 years to end our dependency on China.”
Securing America’s Medicine Cabinet Act of 2020
Representative Vern Buchanan (R-FL), along with Senators Marsha Blackburn (R-TN) and Robert Menendez (D-NJ), introduced bills in the House and Senate earlier this year that called for the federal government to boost U.S. drug manufacturing. Their respective bills, known as Securing America’s Medicine Cabinet Act of 2020, languish in Congress with no actions taken.
According to Buchanan, “As we confront the coronavirus, it has become clear how dangerously reliant we are on China and the global supply chain for pharmaceutical products. We must act swiftly to ensure that America is never again forced to rely on other countries for critical drug components and life-saving drugs….It’s clear we must take immediate steps to make our country more independent when it comes to producing life-saving medicines.”
“Without intervention, the FDA expects the pharmaceutical industry will continue to rely on Chinese companies to make active pharmaceutical ingredients…The status quo has made us vulnerable,” Blackburn warned.
US National Security Is at Risk
In 2019, Christopher Priest, the acting deputy assistant director for health care operations and Tricare for the Defense Health Agency, said: “The national security risks of increased Chinese dominance of the global API market cannot be overstated.” Priest also noted the importance of identifying medicines that would be at risk if China were to use the drug supply as a weapon. He noted that the National Security Council was looking into this possibility.
NBC News reported that retired Brigadier General John Adams is also concerned about our nation’s growing dependence on China. “Basically we’ve outsourced our entire industry to China. That is a strategic vulnerability,” Adams said.
Representatives Adam Schiff (D-CA) and Anna Eshoo (D-CA) expressed concern in a 2019 Washington Post op-ed. They wrote that “the Chinese government could look for ‘pressure points’ where it can wield outsize leverage or force a change of U.S. policy. Pharmaceutical ingredients could be such a vulnerability: By cutting back their supply or manipulating prices, China could cause pharmaceutical costs to surge. Or worse, we could experience shortages.”
Dr. Janet Woodcock, the director of the FDA’s Center for Drug Evaluation and Research, told Congress last year that U.S. pharmaceutical companies were no longer at the forefront of drug manufacturing. She pointed out that America is dependent on foreign supplies and that Chinese registered facilities have more than doubled since 2010. Woodcock warned Congress that America’s dependence on foreign-sourced materials creates vulnerabilities in the U.S. pharmaceutical supply chain.
In 2019, the United States imported over $128 billion worth of pharmaceuticals, our third largest category of imports. China is well aware of our dependence on them. According to Industry Week, Chinese economist Li Daokiu, China is “the world’s largest exporter of raw materials for vitamins and antibiotics. Should we reduce the exports, the medical systems of some western countries will not run well.”
Can We Rely on China?
At the start of the pandemic, China’s Commerce Ministry said China was willing to support nations affected by COVID-19 and that it has not, nor would not, restrict the export of medical supplies. But can we believe that?
In 2008, lax Chinese oversight in the manufacture of heparin, a blood thinner commonly used before surgeries and for other medical conditions, resulted in the death of dozens of Americans with many more unable to receive needed surgeries and treatments. The heparin incident provides only a small look at what could occur if China were to purposefully alter the chemical components of the drug.
China is not the only concern when it comes to pharmaceuticals. Any nation that has a monopoly or near monopoly on APIs or the manufacturing of our generic and non-generic drugs can be equally as dangerous.
According to Gibson of the Hastings Center, “If China shut the door on exports of core components to make our medicines, within months our pharmacy shelves would become bare and our health care system would cease to function.”
Congress needs to review our regulations concerning pharmaceuticals. We must require a reliable API registry and we need a strategic stockpile. We also need to push for American pharmaceutical companies to make their APIs in the United States without any reliance of foreign powers.
America needs to be self-sufficient and not rely on other countries for our medicines, generic or otherwise.
About the Author
Dr. Brian Blodgett is an alumnus of American Military University who graduated in 2000 with a master’s of arts in military studies and a concentration in land warfare. He retired from the U.S. Army in 2006 as a Chief Warrant Officer after serving over 20 years, first as an infantryman and then as an intelligence analyst. He is a 2003 graduate of the Joint Military Intelligence College where he earned a master’s of science in strategic intelligence with a concentration in South Asia. He graduated from Northcentral University in 2008, earning a doctorate in philosophy in business administration with a specialization in homeland security.
Dr. Blodgett has been a part-time faculty member and a program director. He is currently a full-time faculty member in the School of Security and Global Studies and teaches homeland security and security management courses.
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