February 10, 2021

Warren and Smith Urge Congress to Shore Up Pharmaceutical Supply Chain Through COVID-19 Relief Reconciliation

The Senators called on leadership to adopt their bill to invest $5 billion in domestic development of active pharmaceutical ingredients and finished drugs, reducing U.S. overreliance on foreign drug manufacturing; “The pandemic has made it impossible to ignore how global disruptions to medical supply chains can leave our domestic market facing shortages.”

Letter Text (PDF)

Washington, DC - United States Senator Elizabeth Warren (D-Mass.) and Senator Tina Smith (D-Minn.) sent a letter to House and Senate leadership urging them to include provisions from the Pharmaceutical Supply Chain Defense and Enhancement Act in the upcoming COVID-19 relief package in order to boost the nation’s capacity to domestically manufacture active pharmaceutical ingredients (API) and drugs critical to public health and national security, and address the United States’ overreliance on foreign pharmaceuticals.

The Senators wrote that their bill accomplishes goals outlined in President Biden’s American Rescue Plan, which called “for an additional $10 billion investment in expanding domestic manufacturing for pandemic supplies,” as well as his past commitments to “close critical U.S. supply chain gaps” by “leverag[ing] federal buying power and the full range of government authorities, including the Defense Production Act, BARDA, and federal procurements, to make sure that we make critical products in America.”

“We believe that this legislation, which was developed with input from national security experts, supply chain analysts, and domestic drug manufacturers, should be used as the starting point for House and Senate negotiations on relief package provisions related to domestic drug manufacturing,” the Senators wrote. 

“Specifically, we believe that the upcoming COVID-19 package should provide, at a minimum, $5 billion to BARDA for domestic drug and API contracts and additional funding for agencies to purchase domestic drugs. To the extent feasible under reconciliation rules, we believe that the package should also specify that BARDA should (1) prioritize funding the development of “critical” drugs identified by HHS and DoD and (2) include reasonable price requirements in its contracts,” they continued.

The bipartisan United States-China Economic and Security Review Commission estimated the U.S. imports roughly 80% of all active pharmaceutical ingredients (the raw chemical components of drugs) used in domestically-manufactured generic drugs. A Department of Defense medical supply chain analysis showed that many pharmaceuticals used to protect servicemembers from nuclear, biological, and chemical threats were sourced outside of the U.S., raising significant national security concerns. 

On top of these existing risks, the letter notes, “the pandemic has made it impossible to ignore how global disruptions to medical supply chains can leave our domestic market facing shortages.”