Access to Rx Drugs is Priority
Access to medicines and cures should be the priority – the focus – for America right now, not unnecessary complications over trade with the Chinese. We live in an interconnected world. If one nation shuts down the production of a good, it impacts the supply for the whole world. With drugs, the U.S. gets many ingredients from China and if the Chinese shut off access to these materials, American patients will suffer.
The Chinese are using the threat of withholding necessary drug ingredients if trade obstacles with the U.S. supervene. Chinese economist Li Daokui told the South China Morning Post on August 26th, “for vitamins and antibiotics, more than 90 per cent of their raw materials are produced in China.” He pointed out the sad truth that “the U.S. will definitely not be able to produce them in the short term.” In other words, if a trade dispute with China results in the Chinese government shutting off American access to Rx drug ingredients, American patients and users of Chinese sourced vitamins will be the ones who are hurt.
The Chinese are trying to link the Huawei telecom controversy to the drug issue. The U.S. government has pressured allies to bar Huawei, a Chinese telecom giant, from building next-generation 5G mobile networks, arguing its equipment can be used to spy for Beijing. Daokui argued, “of course, we will not take the lead in doing this, but if the US dares to play dirty, we have these countermeasures.” In other words, if the U.S hurts China by continuing current restrictions on Huawei’s access to American technology, they would answer with the withholding of Rx drugs.
Of course, the Chinese government is acting in bad faith to threaten the health of Americans to leverage Huawei access to American markets. However, such threats may work because American consumers care far more about access to medicines than they do about ‘inside the beltway’ machinations. The Chinese are bad actors here, but it may not matter. We should have never been in a position where the Chinese Communist Party (CCP) could essentially blackmail the United States.
Professor Li Daokui is not a government official, yet his garish, provincial message is likely coming right from the political leadership of the CCP.
Right now – today in the midst of a health care crisis – America is, unfortunately, dependent on Chinese suppliers for our Rx drugs supply. This is our current situation. So, the threat coming from the CCP must be taken seriously. The Trump administration has taken action to bring America’s pharmaceutical manufacturing back to the U.S. from China. White House Trade Adviser Peter Navarro, said that the move “will not only help bring our essential medicines home but actually do so in a way that is cost competitive ….”
The Trump Administration has realized during the COVID-19 pandemic that we cannot depend on China to be a reliable manufacturer of products that are critical to the U.S. supply chain. However, it will take time and a concerted effort from both Washington and the pharmaceutical industry to wean America off our Chinese Rx drug dependence.
NBC News reported, “seeking to secure the nation’s supply of critical medications, the Trump administration has signed a $354 million contract that would create the nation’s first strategic stockpile of key ingredients needed to make medicines.” The unprecedented pact is with the Phlow Corporation to build up a strategic national reserve of active pharmaceutical ingredients (APIs). This agreement will allow the U.S. to manufacture more ingredients at home.
The good news is that the U.S. is still the world leader in pharmaceutical innovation, and we manufacture at least the final products of most of our medicines. The bad news is that with the Huawei controversy – and other such trade disputes – we hold a bad hand.
In the pharmaceutical space, the road to rebuilding our domestic capabilities is clear. We will have a certain need for vitamins and some over-the-counter products from China, yet the Phlow contract will secure American capacity to produce generics and APIs at home. We have a fix to reducing U.S. reliance on China for Rx drugs. Once we bring our Rx supply chain home, American trade policy will be set on much firmer ground.
The Coronavirus pandemic exposed how quickly supplies can run out during a serious medical emergency. The FDA currently lists shortages of more than 100 medicines, thanks in part to supply-chain disruptions related to the coronavirus pandemic. The Coronavirus crisis could have been made worse if a trade conflict had led to less engagement and commercial interaction between nations.
American patients cannot be left in a position to be threatened by foreign governments withholding of medical supplies. The CCP or any government can – and will – hold us hostage in trade talks if our ‘medical flank’ is left exposed. Until our government covers that exposed flank, America will be forced to tread lightly in potential trade conflicts. The Trump Administration has waged a successful trade policy with China – holding the CCP accountable for past, bad trade deals. Securing our Rx supply chain will only strengthen America’s position.
It’s past time to ramp up production of Rx drugs and APIs that we currently source from China. The CCP is not a reliable partner. What America needs is more deals, agreements like the one negotiated with Phlow.
Jerry Rogers is the founder of Capitol Allies and the host of “The Jerry Rogers Show” on WBAL NewsRadio. Twitter: @CapitolAllies.
