Modern medicine depends on antibiotics. The surgeries and medical treatments we take for granted each day assume that life-saving antibiotics are always available, whenever needed. However, the United States and Europe no longer control the factories that manufacture their antibiotics. Instead, they depend almost entirely on China for the active pharmaceutical ingredients (APIs) that form the basis of all antibiotics. And so, the stability of American and EU healthcare is now tied to the whims of the Chinese government.
The clearest symbol of America’s lost antibiotic capacity is the former Bristol-Myers Squibb penicillin manufacturing plant in East Syracuse, New York. Built in 1943, it became one of the great industrial pillars of American medicine. At its peak, the facility produced up to 70% of the nation’s penicillin supply. But by 2004, the plant had shut down all penicillin production.
The closure of the Bristol-Myers Squibb plant marked the collapse of America’s domestic penicillin base. And it happened because China’s heavily subsidized production and India’s low-cost formulation drove prices down to levels that western producers couldn’t match. Since 1992, import prices for finished-dose antibiotics have fallen by more than 90%—and fallen roughly 80% for the API building blocks of pharmaceutical production.
As a result, according to a new report by the Coalition for a Prosperous America, no American or European producer can maintain industrial-scale antibiotic operations.
The United States still has some downstream capacity—including USAntibiotics in Tennessee, which manufactures finished-dose amoxicillin products. However, the United States does not have a single remaining domestic antibiotic API producer. That means the U.S. has absolutely no control over the foundational level of its own antibiotic supplies. In fact, China now supplies roughly 87 percent of all U.S. antibiotic API imports—and also accounts for an estimated 80-90% of global antibiotic API production.
And then there’s India, which produces a growing share of finished global antibiotics at rock-bottom prices. That has undermined U.S. producers and led to soaring antibiotic imports. In 2024 alone, U.S. antibiotic imports from India were up 52% from 2012.
Ironically, India’s emerging role as a dominant downstream producer of antibiotics hasn’t solved the China challenge. India still depends on China for 91.3% of its antibiotic API imports. That means finished “Indian” antibiotics still depend on Chinese chemistry.
The concentration of production in India and China has led to potentially disastrous supply bottlenecks. For example, a single Indian firm—Aurobindo—supplies roughly one-third of all U.S. imports of finished-dose antibiotics. And four Chinese suppliers account for 54% of all Indian API imports. That means, a single disruption at one of these plants could trigger a global shortage.
This is a stunningly fragile pipeline. China makes APIs, India turns them into finished antibiotics, and the United States and Europe depend on the results.
The penicillin chokepoint is particularly severe. There are only seven manufacturing sites in the entire world for 6-APA—the vital precursor of semisynthetic penicillin. Five of them are in China. That means supplies of the world’s most primary antibiotic now depend on a vanishingly small number of upstream producers.
Right now, the best hope for the U.S. and Europe is the Sandoz Kundl facility in Austria. The Kundl plant is the last major large-scale vertically integrated penicillin production site in the western world. It still performs the full chain of Penicillin-G fermentation, conversion into 6-APA, synthesis of finished APIs, formulation, and finished doses.
Kundl is the only large-scale penicillin manufacturer outside of China. Should the Kundl facility close, western nations would lose the last remaining plant capable of producing antibiotics outside of Beijing’s control.
Western governments should use Kundl as the anchor for a new strategy to start restoring the entire chain of antibiotic production—from fermentation, APIs, and chemical synthesis to sterile injectables and finished doses.
Government procurement should be used to favor reliable domestic and allied production, including long-term contracts to give manufacturers confidence in new investments. A coordinated U.S.-EU tariff-rate quota system is also needed to counter unsafe and unreliable low-cost imports.
Even with Kundl as an upstream penicillin anchor, and Tennessee’s USAntibiotics producing finished doses, NATO must also focus on antibiotics as an urgent issue. A military alliance cannot be fully prepared if it depends on an adversarial nation for the sources of its antibiotics.
The U.S. and Europe face a profound strategic vulnerability. But with the right policies and market signals, the United States can launch renewed API capacity and restore domestic production of antibiotics. There’s little time to waste in rebuilding the essential stages of antibiotic manufacturing.
Andrew Rechenberg is a senior economist at the Coalition for a Prosperous America.
