July 02, 2020

Warren, Smith Introduce Legislation to Boost U.S. Pharmaceutical Manufacturing Capacity and End Over-Reliance on Foreign Countries for Critical Drugs

COVID-19 exposes troubling truth: U.S. relies heavily on foreign countries for its supply of critical drugs

Bill Text | One-Pager | Section by Section 

Washington, DC - Today, United States Senators Elizabeth Warren (D-Mass.) and Tina Smith (D-Minn.), members of the Senate Health, Education, Labor and Pensions Committee, are introducing The Pharmaceutical Supply Chain Defense and Enhancement Act -- comprehensive legislation that takes bold steps to reinvigorate the United States' manufacturing capacity and end the nation's reliance on foreign countries for critical drugs used by millions of Americans. 

"To defeat the current COVID-19 crisis and better equip the United States against future pandemics, we must boost our country's manufacturing capacity," said Senator Warren. "Our bill will end our overreliance on foreign countries and give us the tools we need to produce the critical drugs that millions of Americans depend on here at home.

"We need to make sure we're able to produce the life-saving medicine Americans need here at home, so we don't have to rely on other countries for the critical drugs we need," said Senator Smith. "I'm glad to have my colleague Senator Warren as a partner on this, and our legislation is essential in order to more easily get medicine to the people who need it during this pandemic and future health crises."

The United States imports nearly 80% of the active pharmaceutical ingredients (APIs), the requisite component of drugs, used in generic drugs that millions of Americans rely on. This overreliance is an alarming national security and public health risk. Foreign manufacturers could restrict or completely cut off the supply of pharmaceutical products during a period of heightened geopolitical tensions or after a natural disaster. Bad actors could tamper with drugs or APIs, rendering them ineffective or even weaponize them, and a lack of information available to the federal government has prevented it from adequately addressing these problems. 

We must take steps to counter this overreliance and ensure that reliable and high-quality drugs can be produced at home. The Pharmaceutical Supply Chain Defense and Enhancement Act:

  • Requires the FDA Commissioner and the Secretary of Defense to develop a confidential list of "critical drugs" essential for public health and national security. The list shall include the name of the drug, as well as all APIs and starting materials necessary to develop it and will be updated every two years to reflect the nation's shifting needs.
  • Provides $1 billion a year for 5 years to the Biomedical Advanced Research and Development Authority (BARDA), to dramatically upgrade our national capacity to manufacture "critical drugs." Funding will be used to contract with U.S. nonprofits and companies to help them invest in the facilities, manufacturing techniques, and drug development processes needed to produce the drugs, APIs, and starting materials included on the "critical drugs" list in the United States. These companies will use advanced manufacturing techniques that will allow for higher quality drugs to be produced more efficiently.
  • Creates a market for domestically-produced pharmaceuticals by requiring DoD, VA, HHS, and BOP to purchase American-made drugs and providing funding to subsidize the purchase of these drugs. These agencies will be given an additional $1 billion over their current procurement budgets to purchase drugs that utilize ingredients produced exclusively in the United States.
  • Boosts supply chain transparency by requiring drug makers to annually report to the FDA information about the source of APIs and starting materials used to make drugs consumed in the United States; requiring drug makers to report to any federal agency that it supplies drugs with information on the foreign manufacturers that produce those drugs and components; and requiring the FDA to issue both public and classified reports to Congress on the strength of the U.S. supply chain. This section provides $20 million to the FDA to update its technological capabilities and establish an API database to track U.S. reliance on foreign manufacturers.
  • Require the FTC and the Treasury Department to study the role of foreign investment in the U.S. pharmaceutical industry within one year of the Act's passage.

Senator Warren has been working to end the U.S. overreliance on foreign countries for critical drugs and boosting the country's manufacturing capacity before and during the COVID-19 crisis. In 2019, she led a bipartisan letter to the Department of Defense highlighting the national security and public health risks of this overreliance. In 2018, Senator Warren and Representative Schakowsky introduced the Affordable Drug Manufacturing Act to radically reduce drug prices through public manufacturing of prescription drugs and re-introduced it in 2019. This year, they introduced the COVID-19 Emergency Manufacturing Act to publicly manufacture personal protective equipment, prescription drugs, and other medical supplies necessary to combat the COVID-19 pandemic.

Senator Warren also called on President Trump to ramp up efforts to publicly manufacture COVID-19 medical products, repeatedly pressed the Trump Administration to use the Defense Production Act and publicly manufacture medical supplies, and investigated "Project Air Bridge," the Trump administration's opaque medical supply chain management after multiple reports of seizures of supplies by federal officials, political favoritism, cronyism, and price-gouging via third-party sellers.

  

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