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Han Li

US lawmakers are pushing for more scrutiny of Chinese investment in pharmaceuticals and biotechnology, as Washington’s strategic competition with Beijing expands beyond semiconductors and artificial intelligence into the healthcare sector.
Bipartisan US senators on Wednesday unveiled legislation aimed at increasing transparency around foreign influence in the pharmaceutical industry, amid growing concerns over US dependence on China for critical drug ingredients and medical supply chains.
“There is no reason why we should be letting our adversary, Communist China, … control our medicine supply chain,” Senator Rick Scott, a Republican from Florida, said. “Right now, we are very dependent.”
The Pharmaceutical Investment Oversight and Accountability Act would require the Federal Trade Commission, in consultation with the Committee on Foreign Investment in the United States (CFIUS), to submit an annual report to Congress examining foreign investment in the US pharmaceutical industry.
The report would assess the impact of reliance on foreign manufacturing on the supply chain; how foreign investment affects domestic drug production; and the impact of foreign investment in DNA sequencing and storage technologies.

Scott announced the bill during a hearing of the Senate Special Committee on Ageing, which focused on healthcare and vulnerabilities in the pharmaceutical supply chain affecting older Americans.
The legislation is also backed by Democratic Senators Kirsten Gillibrand of New York, the committee’s ranking member, and Elizabeth Warren of Massachusetts.
While the bill stops short of restricting Chinese investment or imports, supporters described it as a first step towards a broader effort to reduce US dependence on China for medicines and medical technologies.
Scott warned that China could cut off exports of critical pharmaceutical ingredients needed for life-saving medicines if geopolitical tensions escalated. He also argued that China’s growing role in clinical trials gave it access to sensitive data, while saying no federal agency currently had sufficient authority to address the issue.
“Communist China doesn’t have to steal our medical breakthroughs. We just hand it over to them,” Scott said.
In response, the Chinese embassy in Washington said global industrial and supply chains were determined by market forces and the independent choices of businesses, and that it was “unrealistic and insensitive” to promote theories of shifting supply chains or “decoupling”.
“The US side should refrain from overstretching the concept of national security, earnestly respect market principles and international economic and trade rules,” embassy spokesman Liu Chang said in a statement.
The embassy added that Beijing would closely follow developments and resolutely safeguard the legitimate rights and interests of Chinese companies.
China’s pharmaceutical industry has expanded rapidly over the past two decades, becoming a major player in drug manufacturing and biotechnology. Witnesses at Wednesday’s hearing argued that Beijing’s rise has been fuelled by intellectual property theft, non-market subsidies and predatory pricing practices that allow Chinese manufacturers to sell products below global market prices.
Stephen Ezell, vice-president of the Information Technology and Innovation Foundation, told lawmakers that China had come to dominate production of key starting materials (KSMs) and active pharmaceutical ingredients (APIs).
He said China accounted for 94 per cent of the KSMs used to produce amoxicillin and 74 per cent of the heparin used in the United States, while Chinese companies now represented about 31 per cent of the global new-drug development pipeline.
Ezell also pointed to Chinese biotech company WuXi AppTec as an example of concerns over Chinese involvement in the US pharmaceutical sector. The firm was placed on the Pentagon’s list of Chinese military-linked companies, but has sued to challenge the designation.
Other witnesses argued that Washington should take an even tougher approach towards Chinese investment.
Nazak Nikakhtar, a former assistant secretary for industry and analysis at the Department of Commerce and a lawyer, said Chinese investments that fell under CFIUS jurisdiction should face a “presumption of denial”, meaning investors should have to prove why a transaction deserves US government approval.
One question left largely unaddressed during the hearing was whether reducing US reliance on China’s pharmaceutical supply chain could drive up costs for American consumers.
Warren described the legislation as a first step, suggesting Congress could later consider additional measures, including using the federal government’s purchasing power to strengthen domestic pharmaceutical manufacturing and improve supply chain resilience.
Whether Washington will be willing to pay higher prices in exchange for greater supply chain security, however, remains an open question.
“Right now we effectively focus on low cost, not resilience and not quality,” said Rush Doshi, a senior fellow at the Council on Foreign Relations and an assistant professor at Georgetown University. “As a result, people are not incentivised.”


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China

Lawmakers want more transparency around foreign influence in the sector, saying there’s no reason to allow rival to control supply chain


Lawmakers want more transparency around foreign influence in the sector, saying there’s no reason to allow rival to control supply chain.


Senate bill seeks to curb US reliance on China in drug industry

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Lawmakers want more transparency around foreign influence in the sector, saying there’s no reason to allow rival to control supply chain

Lawmakers want more transparency around foreign influence in the sector, saying there’s no reason to allow rival to control supply chain