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Waltz to Introduce Bill to Lessen American Dependence on Chinese Drugs

Washington, March 23, 2020

WASHINGTON, D.C. – This week, U.S. Rep. Michael Waltz (R-Fla.) will introduce legislation to lessen America’s dependence on Chinese pharmaceuticals and combat America’s supply chain risk.

The Strengthening America’s Supply Chain and National Security Act is a bicameral bill and is sponsored by U.S. Sens. Marco Rubio (R-Fla.), Kevin Cramer (R-N.D.), Tim Kaine (D-Va.), Chris Murphy (D-Conn.) and Elizabeth Warren (D-Mass.) in the Senate. Waltz is the lead sponsor of the bill in the House.

“Coronavirus has unfortunately been a wake-up call to the danger of American reliance on a hostile foreign power like China for medical supplies,” Waltz said. “We must identify our supply chain vulnerabilities and build out domestic capacity to eliminate dependence on China and other nations, for the safety and health of all Americans.”

Specifically, the bill would:

1. Direct the Department of Defense (DoD) to determine the extent of its dependency on foreign entities for drugs, active pharmaceutical ingredients (API), and pharmaceutical components. The DoD would also be required to determine whether this dependency creates a national security risk and create recommendations to eliminate this issue.   

2. Restore Buy American Act’s intent for DoD and Department of Veterans Affairs (VA) purchases.

On February 10, 2020, the U.S. Court of Federal Claims ruled that the country of origin for pharmaceutical companies with respect to the Buy American Act is determined where the manufacture of the final product occurs, not where the API is sourced.

This ruling could open the door to allowing more pharmaceuticals with APIs primarily based in China to qualify for preference under the Buy American Act. This legislation would revert back to the process in place before the ruling on February 10.

3. Requires drug makers to provide the Food and Drug Administration (FDA) with information to determine volume of APIs used in pharmaceuticals.

Currently, the FDA requires drug makers to include the sources of the drug’s API, but it doesn’t require them to provide the volume of API deriving from each of its sources. Because of this, the FDA cannot determine the extent of dependency or target potential risks for drug shortages.

The legislation would require drug makers to provide API information to the FDA in order to determine pharmaceutical dependency on foreign entities like China. The information would then be shared with the DoD to assess risks and “hot spots” more vulnerable to drug shortages.

 “Over a year ago, I warned about our nation’s critical vulnerabilities and supply chain risk in key sectors of our economy, including the medical supply chain, as a result of decades of lost industrial capacity to China,” Rubio said. “The industrial capacity of a nation still matters, and we are learning a painful lesson as a result of the coronavirus pandemic. Once our nation has recovered from this unprecedented crisis, we must take steps to address the systemic vulnerability and supply chain risk that the coronavirus pandemic revealed. It is unfortunate that it took a global pandemic to make clear the ramifications of offshoring our industrial base to countries like China. This legislation represents a serious, bipartisan effort to prioritize the rebuilding of our nation’s productive capacity.”

“The United States government should never accept the unnecessary and avoidable risk of allowing our medical supply chain to be disrupted. If American lives depend on these drugs, we should not depend on foreign adversaries to get them,” Cramer said. “Our bill rightly reprioritizes the Buy American Act and directs the relevant federal agencies to detail how much we rely on other countries for pharmaceutical ingredients.”

“This pandemic has further underscored the need to look at health care through a national security lens,” Kaine said. “It’s critically important that we gain more knowledge of and control over our medical supply chains to reduce our reliance on other nations and ensure adequate supply in times of crisis. I’m proud of this bipartisan legislation that will allow our federal agencies to determine how the U.S. can strengthen our security and our supply chains.”

“Coronavirus has exposed a serious risk in our supply chain. Being dependent on China for pharmaceuticals — especially at the height of this pandemic — poses a serious threat to U.S. national security and public health across this country. I’m glad to work with a group of bipartisan senators to prioritize American manufacturers and ensure adequate pharmaceutical supply throughout this crisis and beyond,” Murphy said.

“The coronavirus pandemic has made clear what we’ve known for years: that our dependence on drugs and drug components imported from China and other countries is a threat to our national security and our public health,” Warren said. “This bipartisan bill proposes commonsense solutions to start addressing this problem and I’ll keep fighting to secure our drug supply chain and boost manufacturing here in the United States.” 

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