Manufacturers source many APIs from overseas facilities because production is cheaper there. In addition, if “Buy American” became the law of the land, the prices that Americans pay for drugs could increase. A natural disaster such as a hurricane could take down all production. If a “Buy American” policy led to a single domestic supplier for certain inputs, the market for finished pharmaceuticals would remain highly vulnerable. The Chinese government’s decision to close much of the economy in response to COVID-19 proved that we may not be able to count on manufacturers in China for crucial inputs in the future.īut that’s an argument for further diversification, not self-sufficiency in the market for APIs. Of course, cultivating suppliers outside China may be wise. As of 2021, 13% of API manufacturing facilities supplying the U.S.

McMorris Rodgers rightly worries about.īy contrast, market forces and international diversification are the most effective ways to ensure that we have the inputs we need to manufacture advanced pharmaceuticals.įor starters, China’s hold on the market for active pharmaceutical ingredients tends to be overstated. And they won’t actually prevent the supply chain disruptions that Rep.

Too often, however, concerns about the resilience of international supply chains devolve into mandates that companies “Buy American.” Such mandates are infeasible in the market for active pharmaceutical ingredients.

If drug manufacturers were unable to secure sufficient quantities of “active pharmaceutical ingredients,” or APIs, the resulting medicine shortages could prove lethal. Her statement reflects the genuine worries of industry experts and ordinary Americans. Representative Cathy McMorris Rodgers, R-Wash., the incoming chair of the powerful House Energy and Commerce Committee, recently warned that the United States is “dangerously dependent” on Chinese supply chains, especially for the raw materials used to make medicines.

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