WASHINGTON — Pharmaceutical executives and lawmakers warned that the United States’ reliance on foreign nations for key pharmaceutical components is disrupting the quality and access American patients have to generic medications at a Senate Special Committee on Aging hearing on Wednesday.
“We’ve seen the results of that dependence,” said Committee Chairman Sen. Rick Scott (R-Fla.). “Contaminated drugs, dangerous recalls and shortages that force doctors and patients to ration care.”
In particular, experts cautioned against relying on foreign nations for active pharmaceutical ingredients (APIs), the most important component of a drug that provides the clinical effects of a medication.
Over 80% of APIs used in U.S. prescription drugs don’t have a domestic source, according to a study from Washington University in St. Louis. China primarily dominates the initial stages of the pharmaceutical supply chain: taking the starting compounds and synthesizing them into APIs.
American manufacturers then integrate APIs into the final dosage form to sell to wholesalers, who will distribute the product to pharmacies and hospitals. The structure of the supply chain forces American manufacturers to be dependent on other nations for the building blocks of the medications sold in the U.S.
But running a pharmaceutical plant is significantly cheaper in countries including China and India compared to the U.S., in part due to subsidies foreign governments provide to incentivize companies for their pharmaceutical exports, said Tom Neely, Chairman of Oxford Pharmaceuticals, a generic drug manufacturer in the U.S.
“Every tablet that leaves our factory is undercut by foreign government-subsidized competitors who treat medicine as a strategic export,” Neely said in written testimony. “The current U.S. trade model has distorted and manipulated the market, directly harming U.S. manufacturers like us and ultimately the well-being of American citizens.”
Experts also raised concerns about the drug safety standards of foreign manufacturing plants compared to those in U.S. facilities. Manufacturing plants in the U.S. operate under strict FDA guidelines, including continuous, surprise inspections, Neely said, while many foreign facilities go long periods without inspections and receive advance notice of the oversight.
A ProPublica investigation published in June revealed that the FDA allowed over 20 foreign factories to continue exporting drugs to the U.S. despite previously banning the plants because of manufacturing violations, raising questions about health risks from foreign-sourced drugs.
In October, the FDA identified significant safety violations at a generic manufacturing facility in India, including the presence of animals in API drums and contaminated storage environments.
“Is it too much to ask that plants don’t have flying birds and skittering lizards?” Sen. Scott said, referring to the FDA’s findings.
Patrick Cashman, the president of USAntibiotics, called on the federal government to create more opportunities for domestic manufacturers to be more competitive, including demanding greater transparency in pharmaceutical supply chains and government assurance of demand despite low-cost foreign production.
Domestic pharmaceutical manufacturing holds the same importance as semiconductor and defense manufacturing, Cashman said in written testimony.
“We are not asking for subsidies or handouts,” Cashman said at the hearing. “We are asking that when the government buys antibiotics, it prioritizes genuine, American manufacturing.”
